If the title sounds familiar it is because it’s derived from Superman’s famous motto. And that is what every CFO is expected to be today, a Superman or Superwoman fighting for truth and justice in their organizations. It is the CFO who is responsible for upholding these principles in their organization and for setting a leading example in terms of decision making. In many cases it is the CFO’s signature on the audited financial statements certifying their fair presentation. This represents all of the business activity in the organization during that period. To be a certification “truthful in spirit” all business activity large and small must be taken into account. Sound impossible? In absolute terms maybe but the CFO must be impactful on the organization’s culture by how truthful they conduct themselves in decision making both large and small. Employees follow what they see more than what they hear. As an example, if they experience a CFO who is lax in terms of approving business expenses they may take liberties with that. If they experience a CFO who is questioning business expense report items both large and small on qualitative grounds this will impact their decision making as well.
I was recently speaking with the CFO of a large company in Egypt and he explained to me how his company faced a labor dispute and subsequent employee strike during the Arab Spring events unfolding their last year. The responsibility for managing the crisis fell to the CFO after employees lost trust in the CEO. The CFO was seen by the employees as an honest broker in listening to their grievances and negotiating with them. This is a prime example of how a CFO’s eminence as a truthful and just leader in the organization served as a tangible asset in a crisis management situation. All eyes throughout the organization are watching whether the CFO is conscious of that or not.
Fight the Kryptonite of Corruption
Just like the kryptonite that Lex Luthor always surprised Superman with that weakened him to his knees, nothing can weaken a CFO’s image and reputation more than a fraud or scandal that goes undetected. CFO’s can impact a culture of truth and justice in their organizations through their own actions but they should also seek the assurance of robust systems support to strengthen the effort. Through transaction monitoring, risk assessment, whistle-blower systems and other elements of anti-corruption compliance and risk management, CFOs can help their organizations manage the reputational and financial risk of corruption as well as protect their hard earned image and reputations as leaders.
By James Babb, Middle East CFO Program Leader