CEOs in Asia Pacific see a powerful future ahead for the CFO, according to a new report by KPMG, "The View from the Top". But almost one-third of those CEOs feel their CFO is not ready for the challenge. KPMG, in association with Forbes Insights, conducted a survey of 178 senior business executives at Asia Pacific companies, including 30 from China and Hong Kong, in September and October of 2014. Responses came primarily from senior executives in financial services, manufacturing, consumer products and telecoms based in 13 Asia Pacific countries and territories.
The report finds that two thirds of the CEOs in Asia Pacific think that applying financial data analysis to achieve profitable growth is an important or extremely important initiative by CFOs in order to bring strategic value to the company. This is followed by applying financial data analysis to derive new operating models (59 percent) and improving forecasting capabilities (57 percent).
CEOs from China and Hong Kong however, have somewhat different views. Sixty-three percent see deriving competitive advantage from risk management as the top priority; attracting and retaining top-notch finance talent ranked second (60 percent), followed by applying financial data analysis to achieve profitable growth (57 percent). Isabel Zisselsberger, Partner, Financial Management, KPMG China, says: “Looking ahead to 2015, I expect these priorities to continue to resonate with our clients in Hong Kong and China, due to increased competition, regulatory and compliance costs, as well as the need to better manage profitability.”
The report notes that CFOs must focus on the key areas of concern – taking a more strategic approach; improving their talent management skills; leveraging technology and data better; and lastly streamlining reporting and control tasks so that they are not bogged down in compliance and regulatory issues.
Egidio Zarrella, Clients and Innovation Partner and Data & Analytics Head, KPMG China, adds: “The CFO has to start playing a major role in the whole technology agenda. They’re going to be asked more and more to find insight from the financials rather than just pumping historical data. CFOs cannot just collect, consolidate and report the numbers, they are expected to be able to explain the numbers or understand what the numbers are telling them.” |  CFOs are going to be asked more and more to find insights from the financials rather than just pumping historical data.
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Geoff Wilson, Chief Operating Officer, KPMG in Asia Pacific, concludes: “This report contains good and bad news for CFOs. The good news is that CEOs believe the CFO’s role will increase in importance over the next three years, compared to other C-suite roles. The bad news is that almost a third of the surveyed CEOs don’t believe their CFOs understand or assist enough with the business challenges they are facing.”
“When KPMG asked CFOs a year ago about their roles, 60 percent were happy with the overall performance of their finance function, and on average less than 10 percent of CFOs rated any of their finance processes or services as a weakness. So there is a clear disconnection between the actual performance of the CFOs and the expectations of their bosses.”
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