Tackling market volatility and sustaining profitability key challenges – CFOs of India

CFO – Chief Financial Officers of corporate India have had a tough FY19. The majority of the CFOs we interacted with for this issue however are optimistic on the growth outlook for FY20, even as the impending clash between the two superpowers of the world threaten to slowdown the growth of the global economy. CFOs agree that the trade war triggers have impacted the business sentiment more than anything else; however, a majority of them remain bullish on the economic undercurrents of India.

CFOs increasingly are spending more time on complying with the regulation and aiding CEOs in adapting to the new regulatory environment. Several leading CFOs have observed that in today's fast-paced growth environment with disruptive tendencies, a lot of companies run the greatest risk of having the most problematic cash cycles. One of the critical tasks for the CFO still remains arranging cash for business expansion and stay ahead of the game. Majority of the CFOs agree ‘cash is the pulse of the company’ and is one of the most underestimated aspect by stakeholders. CFOs are cash masters and ensure growth is not stalled due to lack of cash.

Apart from ensuring that the primary duties such as safeguarding assets, cash flow management, understanding and managing risks, financial reporting, interpreting performance and general financial planning and analysis, a proactive CFO is also expected to understand the pulse of the business and be able to shape it for future readiness.

CFOs have also shared with us the importance of focusing on corporate governance. Be it voluntary disclosures as per the India Disclosure Index issued by FTI Consulting (an independent global advisory firm) or improving the reporting quality, CFOs are the insiders that deliver on transparency.

From an execution perspective, we find that some of the CFOs have prioritised stakeholder satisfaction, leveraging the available cash optimally and margin improvement, while some have prioritised tackling market volatility, declining market share and the frequently changing regulatory environment. Indeed, for many, the priority has been to raise funds for execution of the growth strategy and digitising its operations with an eye on improving its operational efficiency.

There are so many qualities one can look for in a successful CFO. Nowadays, a CFO needs to be dealing with investors and lenders and also taking the company public. Especially if it is a start-up company. From being merely a financial genius to being a custodian of the company’s strategy, growth and evolution, modern CFO has indeed come a long way. Read on to understand the growth outlook of different sectors and economy from none other than India’s leading financial brains who also happen to be the chief allocators of capital of their respective companies. The cutting-edge perspective you get from the chefs of finance can be an unmatched experience. Understand where Corporate India is headed and get a realistic perspective on businesses and the economy in India as you turn leaf. 

Cathie Lesjak CFO of HP 
If you save a dollar, you’ll drop a dollar to the bottom line. But if you save a dollar and you reinvest that back into the business in a disciplined way, a returns-based way, that dollar is actually worth a lot more in the future. And that’s really what running a business is all about.

Read Interviews of CFOs in Regular column.