Ravi highlighted the vital role of CFOs in ensuring compliance while fostering growth
Chief Financial Officers (CFOs) play a pivotal role in organisations, responsible for navigating evolving regulatory challenges while simultaneously fostering growth. Sethurathnam Ravi, former Chairman of the Bombay Stock Exchange (BSE) and Managing Partner at Ravi Rajan & Company, in a keynote address at the BW CFO World Future of Finance Summit and Awards 2023 shed light on the pivotal role of CFOs in today’s complex business landscape.
Ravi underscored the inherent conflict between the Chief Executive Officer’s (or CEO) drive for rapid growth and the CFO’s responsibility for regulatory compliance. While CEOs often focus on expansion and speed, CFOs play a critical role in ensuring that the company adheres to an array of regulations. This dichotomy can create a challenging dynamic within organisations, where one party aims to accelerate growth, while the other emphasises compliance and governance.
Ravi stressed the substantial responsibility that CFOs carry in their roles. “CFOs are tasked with balancing growth objectives with governance, risk management, and compliance. Compliance is paramount, considering the complex regulatory environment in which businesses operate today,” he said.
While talking about the essential qualities of a competent CFO, Ravi stated, “A proficient CFO is not merely a box ticker but someone who comprehends the spirit behind the regulations. They go beyond routine compliance to assess risk factors and align business strategies with these considerations. This strategic alignment is key to ensuring that the company not only adheres to regulations but also thrives in a competitive marketplace.”
Ravi also highlighted the role of CFOs in safeguarding the interests of shareholders. Shareholders often look at CFOs as guardians of their investments. The CFO’s responsibility extends beyond the financials to ensure that the business is managed efficiently and ethically, leading to returns on investment and shareholder satisfaction.
Ravi concluded his address by stating, “In a rapidly changing regulatory landscape, proactive engagement is vital. Businesses must stay ahead of regulatory changes, be proactive in compliance, and engage a CFO who is not merely a spectator but an active strategist.”