Last month, accountants and finance professionals from all over Singapore gathered at the ACRA Public Accountants’ Conference “Transitioning from Value Protection to Value Creation” to discuss the latest issues facing the profession. One of the big themes examined, and the main topic at an ICAEW-led discussion, was how finance professionals can develop as business leaders. At first glance, leadership may be associated more with management bodies, but this is not always the case. Firstly, as one of the oldest accountancy bodies, ICAEW has been training future business leaders for generations. Secondly, and more importantly, leadership roles and the need for leadership skills within organisations are evolving rapidly. Few economies are as well-placed to experience this as 21st-century Singapore.
In the World Bank ‘Doing Business’ Survey 2011, Singapore retained top spot as the most advantageous place in the world to operate, but developed economies cannot afford complacency. Emerging nations are fast developing and, as they industrialise, providing increasing competition. This is why the emphasis is shifting towards developing knowledge- and skills-based economies. Singapore is already one of the leading financial services hubs in the world, and the influx of Chinese, Indian and Middle Eastern companies listing their companies on the Singapore stock exchange (SGX) suggests this trend will continue. But in order to take advantage of the changing economic climate, Singapore will need ever greater numbers of business leaders with financial expertise.
The modern CFO
As markets have globalised and as the pace of commerce has increased, the nature of leadership has changed for successful companies. This is particularly evident in the role of the Chief Financial Officer (CFO). CFOs used to be primarily technical financial experts. In the 21st century, technical expertise is still a vital skill, but the job demands wider abilities. Firstly, a good CFO must be a good supporting business partner for the Chief Executive. The best CFOs are highly trusted advisors, and this relationship lies at the core of successful organisations. For it to work takes not only excellent people skills, but also the ability to empathise and influence, which depends on having a good grasp of the CEO’s priorities and needs.
This means CFOs also need a firm understanding of strategy, enabling them to identify strategic problems and challenge where necessary. This is not just important for the CEO relationship but also when dealing with the Board. CFOs have sometimes attracted unfair reputations as ‘no men’ because they have the power to block projects. However, the ability to see where a proposal could offer revenue opportunities is part of a good CFO’s portfolio. The key is combining the financial acumen with cool strategic planning to identify which opportunities are in tune with the organisation’s direction and which should be avoided.
Effective communication creates credibility
In order to influence the CEO, Board and colleagues, as well as setting out good strategic decisions, it is critical a CFO can communicate effectively. This is also important for external relations. CFOs need to be able to build strong relationships with stakeholders like investors, analysts, bankers and regulators and effective communication is a large part of this. Building these relationships helps create and demonstrate credibility inside and outside of the organisation and is part of building up a strong leadership profile.
Leading from the front
Whilst relationship building, communications and strategy are critical assets for good leaders, the best leaders are more than this. Great leaders are able to inspire employees and colleagues and are not afraid to get stuck in when necessary. This means being able to take responsibility, make strong decisions and being prepared to embrace innovation and lead change. But at the same time, it is important to remain objective and independent and to carefully manage risk. This might sound like an impossible, and maybe even contradictory, task. In practice, it takes experience and hard work, which is why the path to business leadership needs to begin early.
Preparing to lead
Professional development is always a continuous process, but not all skills can be accrued simply through experience. When the skills needed to enhance career progression (such as communication, external relationship-building or strategy) are not tested in the course of a professional’s current role, extra opportunities to engage and stretch these skills are essential. This is one reason bodies like ICAEW offer leadership programmes to members at any stage of their career. Many finance professionals have the abilities necessary to become great business leaders, but these need to be developed through mentoring, peer-to-peer and cross-industry learning, which can place their skills in context and allow them to grow. Early engagement is a great way to lay the foundations for a fast-tracked career path to management.
Leading the way
As China and India show evidence of ever-increasing economic growth, the ASEAN nations are presented with both a challenge and an opportunity. On the one hand it could be easy to see the strong emergent economies as a threat, but for skills-based business-friendly economies, the growing need for financial and professional services could present a number of opportunities. In order to achieve this, business leadership skills are essential.
Mark Billington, ICAEW Regional Director, South East Asia
The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.
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