Balancing Passion and Responsibility: How CFO Biases Can Impact Business Success
The modern CFO role is one of the most complex and multifaceted positions in any organization today. It's not just about managing the finances anymore. CFOs oversee vast swaths of the business, including the technology stack, and in many cases, the CIO reports directly to the CFO. Their responsibilities span finance, accounting, audit, external reporting, investor relations, mergers and acquisitions (M&A), and more. Throw in treasury and tax, and it’s clear that the modern CFO wears many hats. But despite their wide-ranging authority, CFOs are still human. And like all humans, they have biases and passions, favoring some aspects of their role over others.
What happens, then, if a CFO has a clear passion for only a specific part of their vast responsibilities? For example, a CFO might be deeply engaged with M&A, bringing excitement and innovation to that area, while being less enthusiastic about more routine, but no less important, tasks such as financial reporting or tax strategy. This raises an important question: Does this passion make certain functions more valuable within the company simply because they have the CFO’s optimism behind them, or does the company risk underperformance in areas that receive less attention?
The truth lies somewhere in between, and it largely depends on the balance of leadership within the company. When a CFO has a particular passion, such as M&A, it can indeed inject energy and focus into that area. The team members who work within the CFO's preferred domain may feel empowered, valued, and more motivated, benefiting from direct engagement with a leader who genuinely cares about their work. This can drive innovation, improved outcomes, and faster decision-making in that area.
On the other hand, there is a potential downside if this laser focus on a favored function leads to the neglect of other equally critical aspects of the business. Take finance and accounting, for instance. These are the foundational areas that ensure the financial health of the company is monitored and reported accurately. If a CFO, entranced by the thrill of deal-making or M&A opportunities, turns a blind eye to the day-to-day operations of financial management, the company could quickly find itself on unstable ground. Missed details in accounting, errors in audit oversight, or delays in tax filings can have serious consequences that might outweigh the benefits of even the most well-executed M&A strategy.
This doesn’t mean that a CFO’s personal passions are inherently detrimental to the company. In fact, a CFO who brings enthusiasm and expertise to a particular area can be a tremendous asset, especially if that area aligns with the company’s strategic objectives. However, it does mean that a strong leadership structure is needed to ensure that other functions don’t fall through the cracks. The role of VPs, controllers, and supporting executives in areas like finance, treasury, or technology becomes even more critical when the CFO has a clear favorite domain. These leaders must be empowered to run their departments efficiently and to step in with expertise and attention when the CFO is focused elsewhere.
An overlooked function can harm a company, but a CFO who is self-aware enough to build a strong team and delegate effectively can mitigate these risks. If a company excels in hiring a CFO who is laser-focused on the function that is of most value to the company at that moment, and ensures that the rest of the organization is running smoothly through strong leaders, then the company can truly excel. For example, if M&A is the cornerstone of a company’s growth strategy, then a CFO with deep experience and passion in that area might be exactly what the business needs to drive expansion and success. But that same CFO needs a trusted finance team that can manage the company's liquidity, tax strategy, and day-to-day financial operations without constant oversight.
In this case, the key to success isn’t necessarily finding a CFO who is passionate about every part of their role—it’s about ensuring there is balance. The company can thrive when a CFO’s passion for a particular function aligns with the company’s needs, so long as there is a clear structure to support all other critical areas. The CFO, in turn, needs to recognize the areas where they are not as involved and ensure that those areas are in the hands of capable leaders who can carry out their duties with precision and accountability.
Ultimately, a company can benefit from a CFO’s passion, but it requires a thoughtful approach to leadership and delegation. The CFO may not need to be a jack-of-all-trades, but they must be aware of their own biases and surround themselves with a team that can manage the business holistically. When this happens, both the CFO’s favorite areas and the less glamorous but equally important functions can operate in harmony, driving the company toward sustained growth and success.