CFOs justify actions to help business survive downturn
Q: Which, if any, of the following do you feel can be justified if they help a business survive an economic downturn?
Base: All CFOs (372)
15% of CFOs surveyed would be willing to make cash payments to win or retain business.
The role of the CFO is broad and complex.
The CFO is now arguably the most influential role in the organization, particularly at a time when economic uncertainty continues to cause greater volatility in demand for goods and services, complicating the task of managing the cash flow and the balance sheet. Traditional CFO skills are at their most important.
CFOs are a crucial link between the business and the board. They provide a more detailed understanding of the company for the board's strategic decision-making. Boards rely on the CFO for financial information, but also in many cases for operational and compliance detail.
Additionally, regulators and other external stakeholders rely on the CFO as a key interface with the business. Yet it must be recognized that some of the biggest financial statement frauds have been perpetrated by or with the complicity of CFOs.
It is the level of responsibility placed on the CFO that makes them almost uniquely positioned to override controls. Given this, the survey responses of a larger than expected minority of CFOs are concerning.
This group of executives (while not large in absolute number) responded that unethical — potentially criminal — actions in the interests of business survival can be justified. Many appear to be insufficiently aware of significant corruption risks.
While these findings are not consistent with our own experience of CFOs, responses among the nearly 400 CFOs interviewed should be cause for alarm for stakeholders.
Specifically, our survey found that:
CFOs justify actions to help
business survive downturn
- When presented with a list of possibly questionable actions that may help the business survive, 47% of CFOs felt one or more could be justified in an economic downturn
- Worryingly, 15% of CFOs surveyed would be willing to make cash payments to win or retain business and 4% view misstating a company's financial performance as justifiable to help a business survive
- While 46% of total respondents agree that company management is likely to cut corners to meet targets, CFOs have an even more pessimistic view (52%)
- Only 46% of CFO respondents had attended ABAC training
- 16% of CFO respondents do not know that their company can be held liable for the actions of third-party agents
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