CFOs face another unpredictable year. According to recent surveys, these factors are front of mind for many CFOs.

The growing importance of FP&A 

The 2020s are shaping up to be a decade of uncertainty. Covid, then international conflict, supply chain disruption and inflation. 2023 brings the potential of a global recession. CFOs increasingly need to forecast for a multitude of scenarios.    


“By leaning into more agile, data-driven scenario planning, they [CFOs] can model out the potential impacts of market risks. They also have the opportunity to play an active role in driving business agility through collaboration and partnering across functions to position the enterprise to respond to new laws and increasing regulations,” according to a PwC brief regarding the new year.  


Finance executives are taking FP&A more seriously, according to a survey of CFOs in 2022 by Everest Group. The survey found that 70% of organisations have an appetite to invest in creating a future-proof FP&A function in 2022 compared to 47% in 2020. 


Anders Liu-Lindberg explained to CFOTalk that it’s essential not only to forecast different scenarios but also not to bury insights and takeaways when presenting it to other C-suite members.  


Expect top CFOs to lean into FP&A in the next year.

A potential recession might not dampen spending 

It’s an open question whether economies will dip into recession this year. Yet CFOs are being proactive.


A KPMG survey published at the end of 2022 found that despite the threat of recession, spending is still expected to grow in certain areas. “70% of [South African] CEOs indicated that they are expected to increase their headcount over the period by a maximum of 10%, with most CEOs focusing on talent and technology in preparedness for forecasted recession.” 


An international survey of CFOs done by CNBC at the end of last year found that only 22 percent of CFOs expect capital expenditure to decrease in the next year.  


Many CFOs have used the last two years to improve core financial issues. The Everest Group survey found that cash flow improvement was the top priority for the finance function in the previous year.  


Invest in digital transformation or face being left behind 

In an article published in Forbes, Omar Choucair, CFO of Trintech, emphasised the importance of CFOs investing in digital transformation as a top priority for 2023.  


Choucair writes, “Leveraging digital technologies, such as automation, to modernise financial reporting processes improves efficiency and reporting accuracy, compensates for smaller team sizes and frees up time for finance teams to focus on more strategic, value-additive work.” 


However, digital transformation is a vast topic, which can be complex to understand and filled with pitfalls. A recent CFOClub Convo with automation expert Armand Angeli highlighted the risks faced by CFOs, including not understanding the core technology and unrealistic expectations.    


As the CFO role continues to evolve in complexity and importance, having access to a network of experts and fellow CFOs such as those in CFOClub Africa is invaluable.


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