Role of CFOs in New Digital Era

With the introduction of technology, the finance function is changing quite dramatically in recent years and thus has the role of CFOs. In this light, ASSOCHAM organized a virtual panel discussion titled 'Role of CFOs in New Digital Era.' This webinar touched upon the finer aspects of the impact of digitization on the finance function and the evolving nature of a finance leader's responsibilities. The discussion brought forward some strategic insights on the adaption of technology, particularly during COVID-19 and the future of finance function.

The discussion unfolded that while there is an enormous opportunity to use data for running the business more effectively, it is also important to strike a balance between digital change and risk control.

The finance leader's role is not just limited to the finance operation, but they are also involved in corporate decision-making. The CFO needs to have the vision for value creation with assertive leadership and is expected to collaborate by aligning all functions and playing a central role. Agility stands as one of the most critical attributes of a successful finance function by quickly responding to changes in the business environment.

Talking about how the regulatory authorities are coping with digital evolution, the experts highlighted the measures taken to ease the digital transformation. There have been efforts to strengthen the IT Act, 2000 to make it suitable with recent technological advancements, ensure electronic data security, and promote ease of business. This includes enhancing IT infrastructure to enable electronic filing, one-stop services offered by tax authorities, other initiatives such as faceless assessment, e-way bill, online verification of credentials.

When discussing the reasons for digitization within the finance function, panelists spoke at length about the effects of the COVID-19 pandemic that has expedited the process of digital transformation. The time of crisis put forth opportunities for innovation and an inevitable shift from offline to online. The adaption of remote working culture led to digital initiatives to ensure minimal impact on routine activities.

Speaking of other changes required to support digital transformation, the experts mentioned digital tools such as cloud computing, robotic process automation, and various analytical tools, which can drastically elevate the operation and effectiveness of the finance function and improve the value delivered. One can customize the basic ERP system only up to a certain point, and this is where our dependency on other technological advancements like blockchain, artificial intelligence, and big data kicks in.

Moving forward with the discussion, the speakers touched upon key factors to succeed in a digital era, such as designing an organization's structure and processes as per industry best practices, ensuring compliance and investor's expectations, transforming the system from people-driven to process-driven, monitoring transformation projects to ensure it is running on schedule and within the budget, focusing on developing inherent capabilities through transformation and lastly, training.

The fundamental role of the CFO is to create value ethically on a sustainable basis. In conclusion, the session captures how technologies can disrupt the traditional finance function, the measures taken to tackle the challenges caused by COVID 19, the various aspects that have impacted the way finance function operates, enabling change in organizational culture to support the transformation.