How sustainability has expanded the CFO's role

Tags: finance | CFO

Traditionally, sustainability issues have fallen outside the jurisdiction of the Chief Financial Officer (CFO). CFOs ran the numbers, letting others handle soft issues such as social responsibility and corporate citizenship.

But those job silos are crumbling. Investors, business customers and other stakeholders have shown a growing desire to connect a company’s financial performance to its social and environmental impact. To make that connection, they have begun evaluating the company’s performance in the Environmental, Social and Governance (ESG) arena, sometimes referred to as the organization’s “triple bottom line.”

As a result, sustainability issues and financial performance have begun to intertwine. CFOs are getting involved in the management, measurement and reporting of the companies’ sustainability activities. This involvement has expanded the CFO’s role in ways that would have been hard to imagine even a few years ago.

This report, compiled by Ernst & Young, defines the changing meaning of sustainability for a CFO in any organisation. It also covers:
•Investor relations
•External reporting and assurance
•Operational controllership and financial risk management
•Five actions CFOs can take to enhance corporate value through sustainability