Striking a healthy work-life balance is something of a fantasy for many CFOs, but it is the most important habit of highly effective CFOs.
According to Jack McCullough, who has served as finance chief for no fewer than 26 startup companies, it is a mistake to be a workaholic. “Workaholics are not the best long-term performers. There are times in all of our careers when we have to work 80 or 90 hours a week and forego other things. But it’s not a wise long-term strategy.”
In a recent webinar titled 10 “Habits of Highly Effective CFOs,” McCullough said a good formula for a successful CFO includes a lot of “other things”: family, friends, physical exercise, reading (and not just business books), hobbies, and community service.
Also on the list was “continuous learning”. Most of the CFOs interviewed by McCullough are “very intellectually curious”. For example, many them have MBA degrees, which finance professionals often obtain after their careers have begun. And all of them are readers.
Many of them highly value mentors, McCullough added. He advised that CFOs, or those aspiring to the job, seek mentors outside their organisations. It can be awkward, he pointed out, to tell your boss that you need mentoring because you don’t understand some things or need professional polishing.
Most of the effective “habits” on the list are no surprise — for example, “thinking strategically.” Other habits on the list:
Providing ethical leadership. Overall, the finance chiefs McCullough interviewed identified this as the most important characteristic.
CFOs are expected to be the most ethical person in the company, he noted. They need to “fully and accurately disclose all relevant info to all relevant parties”.
Serving as a trusted adviser. That means advising the CEO. But, McCullough stressed, it’s even more important to be a trusted adviser to the board of directors, which represents the interests of shareholders.
Communicating proactively. Effective CFOs are forthright in their communication style, he said. If there’s bad news, they don’t spin it, hide it, or delay it. Their communications are “timely, clear, brief, truthful, and once in a while they need to be compelling, although the other four are more important.”
Performing cross-functionally. Most of the CFOs McCullough interviewed said they like working outside finance more than within it. “A lot of them told me that they’re the best person in the company at selling, the best recruiter, the best fund-raiser, the best deal-maker. They didn’t say this in a cocky way. A lot of it is the trust factor.”
Master deal-making. The key here is an ability to identify opportunities and risks, not just negotiating deals. Several of the CFOs McCullough interviewed spoke of a mind-shift they experienced at some point in their careers, when they began to focus on creating opportunities rather than simply solving problems.
Building elite teams. McCullough often heard from the CFOs about the need to “build a team for where you want [the company] to go, not where you are today.” Team-building skill is especially vital today given the shortage of talent “in places where the innovation economy dominates” and the proclivity of “20-somethings” to switch jobs every couple of years.
Maintaining financial expertise. Every year recently there have been more financial restatements than the previous year. “Sometimes there is a lack of focus on the financial accuracy part of the job as it is not as exciting as all the wonderful strategic, cross-functional, and operational responsibilities.”