The key word is value

In the past few years, the role of CFO has evolved extensively to adapt to the current context. But is ‘adapt’ the right word? Maybe not, if we consider the countless papers in management literature that do underscore the issues that still need to be resolved, but also shine a light on the actual transformations that have taken place and their impact on the business in question. The hottest topics of debate we need to focus on are: defining the role, while factoring in the job market and compensation; corporate sustainability; and technological innovation. 

We spoke to Stefania Santarelli, Group CFO at Elica, a company headquartered in the Marche region with over 50 years of experience in kitchen ventilation systems. Today Elica has seven production sites worldwide and around 3,000 employees. 

Some research suggests that the CFO takes on a strategic role as ‘value creator.’ Do you think this is true? What are the determinants, the actual mission of the CFO today, with respect to a more or less recent past? 

There’s no doubt that the role has evolved, but we can’t count on benchmark standards: the crucial factor today is correctly interpreting scenario changes and, if possible, preempting them. This would allow you to accomplish your mission to protect the business, and it would also make information and evaluations available that would help support the decision-making process, which is faster than it used to be. In this sense, the role of CFOs, which has always been back office, has turned into Chief Value Creator: our contribution goes beyond purely accounting and administration. Instead, now it’s embedded in approaches and dynamics relating to governance, business development, and aligning sustainability goals with the business plan. The bottom line is that, along with the CEO, the CFO is the most appropriate person to communicate the fundamental principles and the levers of value generation, both inside and outside the company. 

What impact has digital transformation had on your role? By this I’m also referring to the current position you hold in a company like yours, one offering products on international markets, manufactured in sites located all over the world.  

Digitalization and internationalization are bi-directional, in the sense that international development can foster digitalization and, by the same token, digital can pave the way for international development, especially in contexts where value chains are global and geographically distant.  New technologies are tools that facilitate interaction, knowledge sharing, and coordination within the group, where the distinction between headquarters and subsidiaries becomes blurred. 

For the Elica Group, technological innovation represents a growth driver. In the Innovation Department, products and services are being developed that guarantee higher standards in terms of quality, safety, and performance, striving toward the dual concepts - Sensors and Connectivity - and using materials with an eye to circular economy. 

As for the product development phase and relative monitoring, at Elica we have a process that leverages tools such as a document management system, for the technical datasheets on every project, and a test lab system where we archive all the results from testing during prototyping. Without this process of digitalizing and archiving data, we would have no way of sharing test results with our facilities, or developing the same product line at multiple production plants while meeting expected efficiency and quality standards. This makes the process of protecting our innovations via patents more robust, and it simplifies a series of administrative activities linked to reporting on the R&D projects that we’re financing. 

Recently we’ve rolled out a data management transition project on the cloud to compensate for legacy systems that lack flexibility. We are also updating our business intelligence systems. This way, it’s simple to generate analysis, scenarios and simulations to make our business more fluid with respect to our decisions. 

In terms of corporate sustainability strategies, a recent survey shows that the CFO acts as mediator and liaison between various functions. This gives the impression that sustainability issues run through the company and into administrative systems as well. Is this true?  

A perfect integration of the business plan and the sustainability plan is the only way to create value in a concrete way. The role of CFO certainly isn’t a technical one in this context. The objective is to monitor and verify firsthand whether the sustainability strategy gets proper attention for all stakeholders to guarantee long-term profitability. 

Sustainability is an opportunity in terms of competitiveness and reputation, but it’s fundamental to focus on objectives and areas of intervention, and to prepare an adequate assessment of costs and benefits. In this sense, it’s physiological that the question of sustainability will be increasingly integrated into administrative processes. This is also due to European legislation, which will eventually make it compulsory for companies to provide more and more detailed reporting on double materiality, disclosure, and reporting on medium- to long-term goals, as well as in-house risk assessment on ESG issues. 

A career as a CFO: Word has it that the job market for this role is limited, and there’s not much international mobility. Do you agree? In what way does this and other factors impact the rules of engagement as far as compensation mechanisms? 

Actually, in today’s job market lots of opportunities are emerging in small companies that are creating roles to support the entrepreneur, in addition to the CEO. They’re looking for people who can make strategic decisions, and who know how to use technological tools: in a market where expectations are higher and higher as far as meeting certain standards of governance and sustainability in the supply chain, it’s essential to field every element of competitiveness. 

As for international mobility, I don’t see any difference with respect to other strategic roles. Many Italian companies have foreign subsidiaries that can’t do without a local CFO who can guarantee that corporate governance procedures and standards are being respected. For example, my professional path has led me to cover CFO roles for foreign markets for an Italian multinational; I later consolidated my experience as CFO for the Elica Group. 

Working to achieve clear objectives, with a strategic development plan, and participating in incentives linked to building long-term wealth: these are fundamental elements in engagement and retention. In addition to this, companies need work to create an inclusive environment that encourages internal growth and promotes a cohesive team, without neglecting welfare and well-being practices.