Chief Financial Officer

What Makes a Great Chief Financial Officer? Honest Advice From Fortune 500 CFOs

Chief financial officer positions continue to evolve, with the median salary reaching an impressive $397,887 per year as of May 2025. While many view this C-suite role through a purely financial lens, the modern CFO contributes far beyond traditional accounting and reporting functions.

The role of chief financial officer has transformed dramatically in recent years. Beyond managing finances, today’s CFOs help set technology direction, make strategic recommendations across departments, and directly influence company growth. Additionally, they play a crucial part in making strategic choices that determine an organization’s future direction. However, despite growing demand with a projected growth rate of 4% from 2019-2029, significant gender disparity exists in the field—only 28% of the 131,815 CFOs currently working in the US are women.

In this article, we’ll explore what truly makes an exceptional chief financial officer based on honest insights from Fortune 500 executives. We’ll examine the essential qualifications, core responsibilities, and emerging challenges facing financial leaders in today’s complex business environment.

The modern CFO: more than just finance

Gone are the days when the chief financial officer simply managed the books and ensured compliance. The modern CFO has evolved into a multifaceted strategic leader who drives business transformation and creates long-term value across the organization. This shift represents one of the most significant C-suite role transformations in modern business.

How the CFO role has evolved over time

Previously, CFOs were primarily responsible for financial oversight, accounting functions, and ensuring fiscal accountability. Nowadays, the scope has expanded dramatically. According to McKinsey, between 2016 and 2021, the number of CFOs responsible for their organization’s digital activities more than tripled. Furthermore, investor relations responsibilities increased from 44% to nearly 66% during the same period.

The expansion goes beyond technology and investor relations. Around half of CFOs have taken on environmental, social, and governance (ESG) or mergers and acquisitions responsibilities in the last two years. Moreover, the number of functional areas reporting to CFOs increased from 4.5 in 2016 to an average of 6.2 in 2018, with further growth in investor relations, procurement, and digital areas by 2021.

This evolution reflects a fundamental shift in how businesses view the finance function. Rather than being isolated number-crunchers, finance teams now sit at the forefront of the business, helping the organization move forward through strategic financial management.

Why strategic thinking is now essential

Strategic thinking has become the cornerstone of the modern CFO role. In fact, according to a survey by McKinsey, 40% of CFOs created the most value for their organizations through strategic leadership and performance management. This makes perfect sense considering their unique position at the intersection of financial expertise and business operations.

The necessity for strategic thinking stems from the increasing complexity of today’s business environment. CFOs possess a comprehensive view of the organization’s financial health, enabling them to identify growth opportunities, evaluate risks, and optimize resource allocation. Essentially, they translate numbers into actionable business strategies.

When asked about competencies that will matter most over the next five years, CFOs ranked driving change, shaping strategy, and developing talent as their top priorities. Specifically, female CFOs were particularly focused on driving change—57% named this the key competency compared to 40% of male CFOs.

The CFO as a partner to the CEO

The relationship between the CFO and CEO has transformed into a powerful strategic partnership. Nearly 30% of CFOs are spending less time on financial oversight and more time spearheading strategic initiatives. Likewise, an increasing number of CFOs report having leadership or co-leadership roles in company transformations.

This partnership works because CFOs bring data-driven insights that complement the CEO’s vision. According to Robert Alvarez, the ideal CFO should devote approximately 40% of their time to the CEO. Certainly, this isn’t just about time allocation—it’s about quality of interaction. “A CEO wants someone who challenges them. Tell them when it is not going to work,” noted Dale Easdon.

Indeed, the partnership is yielding career advancement opportunities as well. Currently, 8.4% of Fortune 500 and S&P 500 CEOs were promoted from the CFO position, up from 5.8% just 10 years ago. This trend underscores how the CFO role has become a strategic launching pad to the highest corporate position.

The most effective CFO-CEO relationships balance vision with financial wisdom. While the CEO may focus on market opportunities and growth, the CFO evaluates financial feasibility and ensures strategic initiatives remain financially sustainable, creating a powerful decision-making dynamic that drives organizational success.

8 traits that define a great CFO

Exceptional chief financial officers possess unique combinations of skills that extend far beyond number-crunching. After speaking with dozens of Fortune 500 CFOs, we’ve identified eight critical traits that consistently separate outstanding financial leaders from the merely competent.

1. Strong financial acumen

First and foremost, top-performing CFOs build their expertise on an unshakeable foundation in financial management and accounting. This expertise transcends basic accounting skills—it encompasses a profound understanding of intricate financial principles, accounting standards, and sophisticated financial analysis techniques. Although this technical knowledge forms the bedrock of their effectiveness, today’s successful financial leaders recognize that financial expertise alone is insufficient in our technologically-driven landscape. Instead, they combine deep financial knowledge with business acumen, developing a comprehensive understanding of internal operations, vendors, customers, competitors, and industry dynamics.

2. Strategic mindset

Beyond managing finances, exceptional CFOs actively shape company direction. In contrast to traditional financial reporting roles, modern financial leaders dedicate significant time to strategic planning rather than focusing solely on finance and accounting matters. Above all, they align financial strategies with broader business objectives, ensuring every financial decision harmonizes with organizational aspirations. A recent survey highlighted this shift, noting that 52% of businesses cite strategic vision as the most important skill in a modern CFO. Through tactical problem-solving and crucial decision-making, today’s financial executives balance short-term needs with long-term vision.

3. Leadership and team building

Great CFOs recognize that strong teams form the foundation of success. Subsequently, they prioritize growth and development of their finance teams through mentorship, training, and career advancement opportunities. Rather than operating in isolation, they foster a culture of adaptability where teams can quickly respond to changes in the business environment. As one experienced finance leader noted, “Figure out where they’re having a challenge, focus on those roadblocks and enable them to thrive and succeed in their role”. By setting clear goals and ensuring everyone understands their role in achieving them, top financial officers build cohesive, high-performing teams.

4. Communication and storytelling

The ability to translate complex financial information into understandable, actionable insights stands as a cornerstone of modern CFO success. Outstanding financial leaders excel at breaking down intricate financial data for diverse stakeholders, including board members, investors, employees, and customers. As one Fortune 500 CFO stated, “By painting a picture with your words, leveraging imagery, emotion, analogies, metaphors, humor, and the other ingredients of storytelling, you are more likely to succeed”. This storytelling skill helps finance leaders build trust, foster transparency, and drive collaborative decision-making across the organization.

5. Risk management expertise

Predicting and managing risk ranks among the top responsibilities of successful CFOs. In this capacity, they serve as the first line of defense in limiting and mitigating business crises. Effective financial leaders employ diverse methods such as risk matrices and technology to gain insights into risk likelihood and impact. Their risk management approach typically includes:

• Systematic identification and assessment of potential risks
• Implementation of strong internal controls to prevent fraud and misconduct
• Development of scenario planning to prepare for financial uncertainties
• Regular strategy updates to maintain agility in changing conditions

Check out this blog on risk management in HR.

6. Tech-savviness and data fluency

In today’s data-driven business environment, exceptional CFOs embrace technological advancement. They leverage financial software, data analytics, and automation tools to streamline processes and enhance accuracy. Additionally, they understand cybersecurity concerns—according to a recent survey, business respondents cite cybersecurity and data security as foremost concerns in adopting AI. By staying at the forefront of financial technology, top financial leaders provide real-time insights to stakeholders across their organizations while ensuring appropriate data governance and security.

7. Adaptability in changing markets

The fast-paced business landscape demands CFOs who demonstrate remarkable flexibility. Adaptability has become a necessary skill as financial leaders navigate economic shifts, technological breakthroughs, regulatory reforms, and unforeseen global events. Alongside this adaptability, they must demonstrate analytical agility—evaluating data quickly, identifying trends, and extracting actionable insights. As markets evolve, outstanding CFOs remain agile, embracing new ideas and innovative approaches while positioning their organizations to thrive amid constant change.

8. Ethical judgment and integrity

Upholding the highest ethical standards remains non-negotiable for exceptional financial leaders. CFOs set the “tone from the top,” with studies showing this as one of the most important indicators of an organization’s control environment. Through personal behavior and public decisions, they communicate core values and establish cultures that prioritize ethical practices. As Warren Buffett noted, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently”. By championing transparency, fairness, and accountability, great CFOs build enduring trust with stakeholders while safeguarding their organizations’ reputations.

What Fortune 500 CFOs say matters most

Many chief financial officers have walked the path before you. Their collective wisdom offers valuable insights for aspiring financial leaders navigating complex business landscapes today.

Lessons from top-performing CFOs

Fortune 500 financial executives consistently demonstrate excellence through balanced performance. According to BCG’s benchmarking study, only 15% of finance functions rank in the top quartile for both efficiency and effectiveness. These top performers score 33% higher than other functions for efficiency and 46% higher for effectiveness. Notably, they achieve this by eliminating non-value-adding activities while ensuring business partner functions focus on forecasting and analytics that drive value creation.

Steve Bramlage, CFO of Casey’s General Stores, emphasizes that “helping the organization achieve good results for investors is the most important long-term indicator of success in the role”. Yet he cautions that technical expertise alone isn’t enough—productive relationships with the CEO, board, shareholders, and operating peers remain equally crucial.

Common advice shared across industries

Across various sectors, successful financial leaders share several consistent recommendations:

• Prioritize talent development – Rob Gladden notes that “internal succession has to become more important,” urging CFOs to actively groom potential successors
• Embrace technology adoption – Unum CFO Mike Zabel stresses providing employees “an experience that feels modern” through advanced technology platforms
• Develop communication skills – CFO David Denton highlights that internal candidates “must have really strong communications skills” and “be able to think dynamically on their feet”

How they balance short-term and long-term goals

Balancing immediate financial demands with future growth represents perhaps the greatest challenge for financial leaders. Jorge Stevenson, CFO of Yuvo Health, explains that “long-term value creation hinges on short-term decisions”. Consequently, CFOs must align with short-term targets like revenue goals and expense control while simultaneously considering risks to long-term value.

Luca Maestri, Apple’s CFO, has mastered financial forecasting that supports both immediate decision-making and longer-term planning. Meanwhile, effective capital allocation ensures every dollar maximizes company value over both timeframes. Strategic financial planning with dual timelines provides clear visibility into immediate financial health while forecasting impacts of long-term investments.

Key responsibilities every CFO must master

Behind every successful organization stands a chief financial officer who excels in four critical responsibility areas. Understanding these core functions provides insight into what makes financial leadership truly effective.

Cash flow and liquidity management

The heartbeat of financial leadership lies in monitoring and optimizing cash movement throughout the organization. Effective CFOs meticulously track cash inflows and outflows to ensure operational stability. This foundational responsibility enables businesses to invest in growth opportunities, maintain vendor relationships, and prepare for unforeseen challenges. Specifically, CFOs focus on positive cash flow to demonstrate increasing liquidity, which helps cover debts, invest in growth, and withstand economic downturns. Nearly 80% of small businesses struggle with cash flow issues at some point, highlighting this function’s critical importance.

Financial reporting and compliance

Initially, CFOs must ensure all financial statements accurately represent the organization’s position. These leaders adhere to Generally Accepted Accounting Principles (GAAP) and regulatory requirements from entities like the SEC. They’re personally responsible for attesting that financial reports—including balance sheets, P&L statements, and cash flow documents—are accurate and complete. Additionally, CFOs implement robust internal controls to prevent fraud and financial mismanagement. Their oversight extends to ensuring compliance with regulations like the Sarbanes-Oxley Act, which includes provisions concerning fraud prevention.

Forecasting and scenario planning

Ultimately, CFOs don’t simply report what is—they predict what might be. Financial forecasting involves projecting future outcomes based on both internal factors (sales trends, labor costs) and external elements (market demands, competitive pressures). Organizations using machine learning for forecasting report error rate reductions of up to 50%. CFOs typically forecast for short-term (three months), mid-term (six months), and long-term (one year) periods.

Capital allocation and investment decisions

Primarily, CFOs develop strategies for distributing financial resources to maximize returns. Unfortunately, only 47% of CFOs say their capital allocation process effectively meets total shareholder return goals. Successful CFOs prioritize high-return opportunities even during uncertainty. Furthermore, they classify investments using five risk factors: experience with investment type, predictability, speed of impact, upside potential, and historical data.

Challenges facing CFOs in 2025 and beyond

As we look toward 2025 and beyond, chief financial officers face a landscape filled with unprecedented challenges that require new approaches and skillsets. The finance function must evolve rapidly to address these emerging issues.

Navigating economic uncertainty

Economic turbulence continues to reshape financial strategy. With economists predicting recession in the next 12 months and inflation rates more than doubling since 2020, CFOs must develop robust scenario planning capabilities. Geopolitical tensions—including the war in Ukraine, political unrest across multiple regions, and ongoing pandemic effects—have created persistent supply chain disruptions. For this reason, 63% of CFOs report feeling overwhelmed by financial challenges multiple times monthly. Forward-thinking finance leaders view this uncertainty not as a threat but as an opportunity for strategic innovation.

Managing digital transformation

Digital evolution presents another significant hurdle. Remarkably, 88% of CFOs struggle to capture value from technology investments. Leading transformation efforts has become the top priority for CFOs in 2024, yet many finance departments lack sufficient technology-focused staff. Only finance leaders who take direct responsibility for digital initiatives have better-than-even odds of realizing expected benefits. First of all, CFOs must rethink operating models while simultaneously supporting enterprise strategy execution.

Attracting and retaining finance talent

The talent shortage has reached critical levels. Correspondingly, 83% of senior leaders reported an accounting talent shortage in 2024, up from 70% in 2022. Nearly half of CFOs note that employee burnout and career changes are driving this shortage. At the same time, accounting professionals have decreased by almost 50% since 2016, with most CPAs averaging 53 years of age and approaching retirement. In effect, talent development has become a strategic imperative.

Ensuring data governance and security

Finally, data quality remains a fundamental concern. Currently, over one-third of CFOs believe data quality inhibits AI adoption in finance. Without proper governance, data can become messy, biased, or incomplete—leading to inefficiencies and poor decisions. Organizations with strong governance frameworks build customer trust while enabling advanced technologies to reach their full potential.

Conclusion

The CFO role has undeniably transformed from a numbers-focused position into a strategic powerhouse within modern organizations. Financial leaders now shoulder responsibilities far beyond traditional accounting, actively shaping company direction while maintaining their fiscal oversight duties. Their expanded influence across technology, investor relations, and environmental governance demonstrates this remarkable evolution.

Successful CFOs balance seemingly contradictory qualities. They combine deep financial expertise with strategic vision, analytical precision with compelling storytelling, and risk management with growth-oriented thinking. This unique blend of skills explains why many financial executives eventually step into CEO roles.

Fortune 500 financial leaders consistently emphasize talent development, technology adoption, and communication skills as critical factors for success. Additionally, they stress the importance of balancing immediate financial demands with long-term growth initiatives – perhaps the greatest challenge facing modern financial executives.

Cash flow management, financial reporting, forecasting, and capital allocation remain the foundational responsibilities that support all strategic initiatives. Though these traditional duties persist, the approach has evolved dramatically through data analytics, automation, and advanced modeling techniques.

Looking toward 2025 and beyond, CFOs must prepare for unprecedented challenges. Economic uncertainty, digital transformation demands, critical talent shortages, and data governance concerns will test even the most capable financial leaders. Those who embrace these challenges rather than merely reacting to them will position their organizations for sustainable success.

The most exceptional financial leaders recognize their unique vantage point at the intersection of numbers and strategy. They translate financial insights into business opportunities while maintaining unwavering ethical standards. Therefore, as the business landscape continues evolving, CFOs who combine financial expertise with strategic vision, technological fluency, and people leadership will undoubtedly shape the future of their organizations.

Key Takeaways

The modern CFO role has evolved far beyond traditional finance, requiring strategic leadership and diverse skills to drive organizational success in today’s complex business environment.

• Modern CFOs spend 40% less time on financial oversight and more on strategic initiatives, with responsibilities expanding to include technology, ESG, and M&A functions.

• Eight critical traits define exceptional CFOs: financial expertise, strategic thinking, leadership skills, communication abilities, risk management, tech-savviness, adaptability, and ethical integrity.

• Only 15% of finance functions rank in the top quartile for both efficiency and effectiveness, with top performers scoring 33% higher on efficiency metrics.

• CFOs must master four core responsibilities: cash flow management, financial reporting compliance, forecasting with scenario planning, and strategic capital allocation decisions.

• Major 2025 challenges include economic uncertainty (63% feel overwhelmed monthly), digital transformation struggles (88% can’t capture tech value), talent shortages (83% report accounting shortfalls), and data governance issues.

The most successful CFOs balance immediate financial demands with long-term strategic vision, serving as trusted partners to CEOs while building high-performing teams. Their unique position at the intersection of numbers and strategy makes them increasingly valuable as potential CEO successors, with 8.4% of Fortune 500 CEOs now promoted from CFO roles.

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