CFO Priorities in 2023: The Main Items on Your Agenda

The CFO’s job title may only name finance but the role has evolved to be much more than a numbers game. 

According to BlackLine’s study, more Chief Financial Officers feel that they, rather than the CEO, are responsible for steering their organization through tough economic times.

Today, you’re more likely to be operating on a multidimensional chessboard, where strategy meets finance. While the proverbial “buck” still stops at the numbers, the numbers are the business.

When it comes to the overall financial health of the organization, you are expected to be the catalyst of company growth. You need to be focused on strategic partnerships, evaluating technology, and working to meet revenue and earnings goals.

In this article, I’m looking at the key priorities for CFOs in 2022 and 2023 and how you can better prepare for the future.

Macroeconomic Snapshot

Here’s the lowdown:

• The world economy is expected to grow by 2.3% in 2023—that's a 0.4% increase from the January forecast. Come 2024, you can expect a 2.5% growth rate.
• Resilient household spending is painting a slightly brighter picture for the future. The growth forecast is getting a leg-up from 2022, reaching 1.1% for 2023. 
• Over in the European Union, the economy is getting a boost from lower gas prices and strong consumer spending, leading to a projected growth of 0.9%.  
• Tighter monetary policy, the slow crawl of growth in Europe and China, mounting energy costs, and a pricier dollar are all affecting the economy.
• Investing cash outflows are on the rise, with a noticeable surge in information-processing equipment and software domains.
• The unemployment rate has crept up to 5.5%. While this may mean it’s a bit easier to find qualified talent, validating the accuracy of that statement would require a much deeper, specific analysis. All in all, the labor landscape still presents its challenges.

Top CFO Priorities from 2022

Even though these themes emerged last year, these CFO priorities are relevant in today’s business environment and should be considered on a larger scale.

Addressing Pricing Pressures

Caught in the aftermath of COVID, rising inflation, economic uncertainty, and evolving consumer needs, you may have felt the heat. The pressing need to navigate these intersecting economic storms while safeguarding profit margins was (and continues to be) a high-stakes challenge. 

It's no wonder most CFOs revised their pricing strategies to counterbalance rising labor and raw material costs, alongside the increasing cost of capital. That being said, price hikes have never been the answer to sustained growth and good financial performance. 

In a bid to satisfy customer demand and keep expenses in check, CFOs around the world started leaning towards digital transformation. The generally accepted belief in digital advancements to deliver immediate operational efficiencies and long-term revenue growth has grown substantially.

Investing in digital skill enhancement and capabilities in data analytics, artificial intelligence, and cloud technology continues to top the priority list for CFOs. These strategic investments aim to streamline costs, energize the workforce, and steer company revenue goals in the right direction.

Automation Strategies

The digital transformation and automation of financial processes accelerated at a much faster pace than most CFOs predicted. According to the Accenture survey of CFOs, 60% of traditional finance tasks were automated, which was up from 34% in 2018.

The next best step here was hyper-automation. It combines robotic process automation (RPA) with machine learning, making repetitive processes better by using different types of new technology together.

Automation isn't just about efficiency, it's about precision too. It can streamline processes and reduce error rates. For example, automating order processing can lead to faster fulfillment and fewer human data entry errors.

Having real-time monitoring and analytical powers lets businesses nip problems in the bud. For example, by automating quality control operations, companies can spot and fix any faults with a product before it reaches the customer.

Strong C-Suite Collaboration

A robust partnership between CFOs, CIOs, and other finance executives has emerged as a crucial element driving organizational growth. The past few years have ushered in the era of the “Strategic CFO,” a role characterized by open, frequent, and strategic communication between key leaders. This has been instrumental in helping organizations stay afloat during the pandemic and remains crucial for post-pandemic success planning.

​​Acting as catalysts for efficiency and agility, CFOs and CIOs, in partnership with CEOs, wield the most influence when they share a unified vision. This synergy can lead to significant value generation within an organization. 

It brings together the expertise and experience to find solutions to operational challenges and paves the way for the addition of value-added processes, platforms, and frameworks, ranging from finance process improvements to employee engagement initiatives.

Effective communication between leaders then trickles down to the team, providing them with the necessary tools to excel. This fosters a culture that not only supports employees in ways that matter to them but also creates a sense of belonging, making them want to stay and contribute towards the organization's growth journey.

Top CFO Priorities 2023

Steering the Ship with the Right Workforce

The old maxim still rings true: the higher you climb in a company, the more you rely on others to do your job. But for you and other leaders, talent management has become a challenging task lately.

Undeniably, the pandemic aftermath has triggered a paradigm shift in our work norms. Three years down the line, businesses are still trying to find the ideal balance between on-site and remote work. Moreover, defining and quantifying talent performance and productivity in this new landscape is a challenge.

The conventional KPIs we've relied on to evaluate teams may not work as well in a hybrid environment. It's still somewhat unclear how such setups affect employee engagement, productivity, and, subsequently, the company's overall growth trajectory.

In response to growing demands, you might find yourself tweaking, downsizing, simplifying, or even revamping the tasks your teams undertake. The challenge isn’t necessarily doing more with less but rather doing higher-value work in a smarter way. 

One effective approach here is to proactively collaborate with HR to develop training programs that fill skill gaps. Offering career advancement opportunities, upskilling, clarity in growth prospects, flexible work locations, and competitive salaries have proven to be some of the most effective strategies for talent retention.

Embracing Tech Advancements to Turn Information into Insights

If there’s one word that echoes louder than others in our boardrooms today, it’s insights. These aren't just any insights, though. These are the game-changing, data-driven kind that can spark growth, outsmart competition, repel disruption, and even create new opportunities.  

But here's the catch: these insights don't just spring out of thin air. They are born from a careful blend of the right data, processes, technologies, and people - a CFO's priorities should be to ensure they're keeping tabs on those people, processes, and technologies!

Let's not forget the tech breakthroughs that are constantly reshaping the playing field. Remember the buzz around the metaverse last year? Now, it seems AI has stolen the limelight.

Yet, amid all these tech twists and turns, one thing remains constant: digital technologies can unlock useful metrics for business insights. 

According to a recent Deloitte report, the right combination of digital transformation actions can unlock as much as US$1.25 trillion in additional market capitalization across all Fortune 500 companies.

For example, virtual scenario modeling and real-time data analysis supplied by AI could enable you to evaluate various options and their implications for key decisions. 

However, harnessing data for insights and decision-making, whether for the finance function or the business at large, comes with its own set of challenges There's often a mismatch between the data you collect and the data you actually need for action and insights. Plus, your team may not have the know-how to use this data to form a game plan. 

So, your talent strategy may need some optimization so it focuses on data, storytelling, and visualization. After all, the future belongs to those who can see, understand, optimize, and use data to steer growth. 

Not Ignoring the Tailwinds of Climate Change

The Securities & Exchange Commission proposed that all public companies disclose their carbon emissions, climate risks, and plans for reducing greenhouse gases starting in 2024. This may force you to deal with climate and sustainability issues, which your investors, business partners, and stakeholders may have different opinions about.

While some companies may see environmental, social, and (corporate) governance (ESG) investments as a way to benefit their stakeholders, others may not have a system in place for interacting with these groups. 

And there are risks to consider in both the climate and sustainability aspects. Different opinions about a company's policies could result in legal issues, possible consequences at the local and state levels, internal arguments, and a potential PR nightmare.

So, should you dive into the deep end of climate and sustainability plans, or sit on the sidelines and wait it out a bit? In my opinion, implementing a solid game plan now can bring transparency, meet stakeholder expectations, and show investors, customers, and employees the potential outcomes of different strategies.

You can also collaborate with other C-suite colleagues to invest in processes, products, and services related to sustainable practices. Success in these plans will likely depend on financial analysis and capital allocation, which is your home turf.

Staying Resilient in the Face of Change

Navigating the ebbs and flows of 2023 has made one thing clear: the need for a focused approach toward enterprise risk. Companies are increasingly finding themselves on the front lines of several threats–internal, domestic, and international. And who's left holding the fort? It's your job to prepare for the best and brace for the worst. 

For example, a geo-political conflict like Russia-Ukraine had ripple effects on finance departments across the world. It set off a domino effect of supply-chain disruptions, inflated input costs, and uncertainties that extended far beyond the European region. Another example was China's COVID lockdown coupled with political unrest elsewhere, which forced many C-suite executives to re-evaluate the future of their business operations.

Then there are the economic plot twists known as inflation, interest rates, cybersecurity, and the threat of a recession. As the regulatory landscape intensifies, you now have to tackle more than just number-crunching and taxation to focus on issues like third-party risk, data-sharing and privacy, climate change, and network integrity.

Unfortunately, that’s not it. Another item on the CFO's 2023 agenda? The Global Minimum Tax (GMT) Pillar 2 introduces a minimum effective corporate tax of 15% for large multinational corporations.

This means your finance team will be in the hot seat, ensuring compliance with the GMT while minimizing potential risks from the mandate. With all the constant (and drastic) changes, it’s your job to identify priorities and work with the right teams to build a game plan.

Your Priorities Are Multifaceted

At the end of the day, the priorities of CFOs will always boil down to what you can do to achieve business growth right now without sacrificing long-term sustainability. Start from the broader picture and bring it down to an action plan for the next six months. This could be hiring new talent, financial planning, and discussing steps to address ESG investments.

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