The colors of spring

Three ways CFOs are adapting to emerging private equity trends

A new era is here. The 2023 EY Global Private Equity Survey explores how organizations can build a bridge to the future.

Three questions to ask

  • How are emerging private equity trends shaping the strategic priorities of CFOs and COOs?
  • What factors do private equity CFOs see as vital to their strategy for accelerating their organization’s growth?
  • In the wake of the Great Resignation, what are the top talent management goals for financial executives at private equity firms?

The chief financial officer (CFO) and chief operating officer (COO) have left a lasting imprint on the private equity industry. Now, as the industry approaches maturity, it’s time to ask the question: What will be their legacy? Over the past 10 years, the EY Global Private Equity Survey has followed the evolving impact that financial executives have had on a rapidly growing industry. In our 10th annual survey, we reflect on the hurdles CFOs and COOs have faced over the past decade and look ahead to forecast the role these executives will play in shaping the future as they respond to emerging trends in private equity.

The CFO role has continued to evolve as private equity firms grew in size and complexity. No longer solely the leader of routine finance functions such as accounting, tax and accounts payable, the financial executive fills a broader role, one that includes more strategic functions, such as providing support to investment professionals and portfolio companies and overseeing a larger talent management pool. In this evolved leadership position, CFOs are expected to provide the data to support potential initiatives. This could include everything from adding product offerings to expanding the traditional investor base and even guiding the firm through such strategic transactions as selling equity in the firm or acquiring other businesses.

As we enter a new era of economic uncertainty, CFOs will need to rely heavily on the experience they have gained as they seek to help their organizations remain competitive. This means they must continue to focus on recruiting and retaining top talent, deploying advanced technologies to improve operational efficiency, and identifying new ways to expand product offerings. They will also need to continue honing their abilities as strategic advisors to other members of the C-suite, helping them manage portfolio companies and make the right investment decisions.

The future will also bring unforeseen advances and challenges, from new technology developments to an increasingly volatile geopolitical landscape. Judging from their track record during the 10 years that we’ve conducted this survey, we have every confidence that private equity CFOs will help their organizations step up and remain focused on sustainable growth and value creation.