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48-407: The CFO typically reports to the chief executive officer (CEO) and the board of directors and may additionally have a seat on the board. The CFO directly assists the chief operating officer (COO) on all business matters relating to budget management, cost–benefit analysis, forecasting needs, and securing of new funding. Some CFOs have the title CFOO for chief financial and operating officer . In

96-404: A nonprofit organization . CEOs find roles in various organizations, including public and private corporations , nonprofit organizations , and even some government organizations (notably state-owned enterprises ). The governor and CEO of a corporation or company typically reports to the board of directors and is charged with maximizing the value of the business, which may include maximizing

144-401: A big-picture thinker, rather than detail-oriented, outspoken rather than reserved, prefer to delegate rather than be hands-on, emphasize what gets done rather than how things are done, and make collaborative rather than unilateral decisions. The CFO must serve as the financial authority in the organization, ensuring the integrity of fiscal data and modeling transparency and accountability. The CFO

192-451: A different area of responsibility (e.g., VP of finance, VP of human resources). Examples of subordinate executive officers who typically report to the CEO include the chief operating officer (COO), chief financial officer (CFO), chief strategy officer (CSO), chief marketing officer (CMO) and chief business officer (CBO). The public relations -focused position of chief reputation officer

240-489: A distinction between management by the executive board and governance by the supervisory board. This allows for clear lines of authority. The aim is to prevent a conflict of interest and too much power being concentrated in the hands of one person. In the United States, the board of directors (elected by the shareholders ) is often equivalent to the supervisory board, while the executive board may often be known as

288-402: A facade of charm and eloquence. Traits such as courage and risk-taking, generally considered desirable, are often found alongside these psychopathic tendencies. Tara Swart, a neuroscientist at MIT Sloan School of Management , has suggested that individuals with psychopathic traits thrive in chaotic environments and are aware that others do not. As a result, they may intentionally create chaos in

336-599: A person needs to be a member of such professional body to hold out to the public of the jurisdiction as an accountant. The designations for qualified accountants vary from jurisdiction to jurisdiction, such as Cost and Management Accountant (CMA), Chartered Accountant (CA/ACA), Chartered Certified Accountant (CCA), Chartered Professional Accountant (CPA), Certified Public Accountant (CPA), Certified Practising Accountant (CPA), Certified Management Accountant (CMA), Chartered Management Accountant (ACMA) or Chartered Public Finance Accountant (CPFA). Some countries have

384-493: A political party is often entrusted with fundraising, particularly for election campaigns. In some countries, there is a dual board system with two separate boards, one executive board for the day-to-day business and one supervisory board for control purposes (selected by the shareholders). In these countries, the CEO presides over the executive board and the chairperson presides over the supervisory board, and these two roles will always be held by different people. This ensures

432-541: A related development, British politician Andy McDonald received praise for educating a CEO on the role of trade unions. This occurred as the restaurant chain McDonald's faced scrutiny in the UK Parliament over allegations of a toxic workplace culture. Professional accounting body A professional accounting body is an organization or association of accountants in a particular jurisdiction . Usually

480-458: A single professional accounting body while others have several. If there is more than one body, such bodies may or may not compete with each other; in some countries, professional accounting bodies are divided according to their field of activity. For example, India has two professional accounting bodies: the Institute of Chartered Accountants of India deals with only financial accounting ,while

528-599: A source of criticism following a dramatic rise in pay relative to the average worker's wage . For example, the relative pay was 20-to-1 in 1965 in the US, but had risen to 376-to-1 by 2000. The relative pay differs around the world, and, in some smaller countries, is still around 20-to-1. Observers differ as to whether the rise is due to competition for talent or due to lack of control by compensation committees. In recent years, investors have demanded more say over executive pay. Lack of diversity amongst chief executives has also been

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576-504: A source of criticism. In 2018, 5% of Fortune 500 CEOs were women. In 2023 the number rose to 10.4% of for Women CEO's of Fortune 500 companies . The reasons for this are explained or justified in various ways, and may include biological sex differences, male and female differences in Big Five personality traits and temperament, sex differences in psychology and interests, maternity and career breaks, hypergamy , phallogocentrism ,

624-483: Is as much a part of governance and oversight as the Chief Executive Officer (CEO), playing a fundamental role in the development and critique of strategic choices. The CFO is now expected to be a key player in stockholder education and communication and is clearly seen as a leader and team builder who sets the financial agenda for the organization, supports the CEO directly and provides timely advice to

672-879: Is attested as early as 1782, when an ordinance of the Congress of the Confederation of the United States of America used the term to refer to governors and other leaders of the executive branches of each of the Thirteen Colonies . In draft additions to the Oxford English Dictionary published online in 2011, the Dictionary says that the use of "CEO" as an acronym for a chief executive officer originated in Australia , with

720-402: Is often used in lieu of chief executive officer. Business publicists since the days of Edward Bernays (1891–1995) and his client John D. Rockefeller (1839–1937) and even more successfully the corporate publicists for Henry Ford , promoted the concept of the " celebrity CEO". Business journalists have often adopted this approach, which assumes that the corporate achievements, especially in

768-418: Is sometimes included as one such subordinate executive officer, but, as suggested by Anthony Johndrow, CEO of Reputation Economy Advisors, it can also be seen as "simply another way to add emphasis to the role of a modern-day CEO – where they are both the external face of, and the driving force behind, an organization culture". In the US, the term "chief executive officer" is used primarily in business, whereas

816-590: Is specifically charged with overseeing financial management matters, establishing financial management policies and requirements, and monitoring the establishment and operation of federal financial management systems. OFFM is led by a controller . The CFO Act also established the CFO Council, chair by the OMB Deputy Director for Management and including the CFOs and Deputy CFOs of 23 federal agencies,

864-721: Is specified given that responsibilities extend to tax and financial reporting . Similarly, financial managers are often qualified accountants . In large companies, CFOs and FDs may hold additional postgraduate qualifications, such as a Master of Business Administration , or Master of Science in Finance ; the Chartered Financial Analyst is also common. These complement the accounting perspective with more general strategic , leadership and financial market considerations, and give exposure to broader financial and operational issues. The federal government of

912-428: Is well underway, is best-evidenced by the "CEO-in-Waiting" status that many CFOs now hold. Additionally, many CFOs have made the realization that an operating environment that values cash, profit margins, and risk mitigation is one that plays to the primary skills and capabilities of a procurement organization; CFO's have been encouraged to appoint a chief procurement officer (CPO) where this post does not exist, ensure

960-598: The executive committee (the division/subsidiary heads and C-level officers that report directly to the CEO). In the United States, and in business, the executive officers are usually the top officers of a corporation, the chief executive officer (CEO) being the best-known type. The definition varies; for instance, the California Corporate Disclosure Act defines "executive officers" as the five most highly compensated officers not also sitting on

1008-456: The profitability , market share , revenue , or another financial metric. In the nonprofit and government sector, CEOs typically aim at achieving outcomes related to the organization's mission, usually provided by legislation . CEOs are also frequently assigned the role of the main manager of the organization and the highest-ranking officer in the C-suite . The term "chief executive officer"

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1056-524: The Act, the CFO, regardless of their status as a Key Management Personnel (KMP), is required to sign the financial statements as they are responsible for overseeing the financial operations of the entire company. Their responsibilities include financial planning and monitoring cash flow. In some companies, the CFO and Finance Director positions may be held by the same individual interchangeably. As an internal member of

1104-544: The Key Managerial Personnel (KMP). The Act does not impose any specific regulations regarding the compensation of a Chief Financial Officer (CFO), unless they serve on the Board of Directors or hold additional managerial responsibilities alongside their role as CFO. Additionally, the Act does not outline any specific qualifications required for the appointment of a CFO. However, according to Section 134(1) of

1152-715: The OFFM controller, and the Fiscal Assistant Secretary, the head of the Office of Fiscal Service of the Department of the Treasury . Its mandate is to work collaboratively to improve financial management in the U.S. government and "advise and coordinate the activities of the agencies of its members" in the areas of financial management and accountability. OMB Circular A-123 (issued 21 December 2004) defines

1200-528: The UK, chief executive and chief executive officer are used in local government , where their position in law is described as the "head of paid service", and in business and in the charitable sector . As of 2013 , the use of the term director for senior charity staff is deprecated to avoid confusion with the legal duties and responsibilities associated with being a charity director or trustee, which are normally non-executive (unpaid) roles. The term managing director

1248-402: The United States has incorporated more elements of business-sector practices in its management approaches, including the use of the CFO position alongside, for example, an increased use of the chief information officer post, within public agencies. The Chief Financial Officers Act , enacted in 1990, created a chief financial officer in each of 23 federal agencies. This was intended to improve

1296-422: The arena of manufacturing, are produced by uniquely talented individuals, especially the "heroic CEO". In effect, journalists celebrate a CEO who takes distinctive strategic actions. The model is the celebrity in entertainment, sports, and politics – compare the " great man theory ". Guthey et al. argues that "...these individuals are not self-made, but rather are created by a process of widespread media exposure to

1344-421: The board of directors. In the case of a sole proprietorship , an executive officer is the sole proprietor. In the case of a partnership , an executive officer is a managing partner, senior partner, or administrative partner. In the case of a limited liability company , an executive officer is any member, manager, or officer. Depending on the organization, a CEO may have several subordinate executives to help run

1392-434: The board of directors." The uneven pace of recovery worldwide has made it more challenging for many companies. CFOs play a more critical role in shaping their company's strategies today, especially in light of the highly uncertain macroeconomic environments, where managing financial volatilities is a centerpiece for many companies' strategies, based on a survey held by Clariden Global. CFOs are increasingly being relied upon as

1440-440: The day-to-day administration of the company, each of whom has specific functional responsibilities referred to as senior executives, executive officers or corporate officers. Subordinate executives are given different titles in different organizations, but one common category of subordinate executive, if the CEO is also the president, is the vice president (VP). An organization may have more than one vice president, each tasked with

1488-562: The existence of old boy networks , tradition, and the lack of female role models in that regard. Some countries have passed laws mandating boardroom gender quotas. In 2023 Rockefeller Foundation awarded a grant to Korn Ferry to research strategies and then action a plan to help more women to become CEO's. There are contentious claims that a significant number of CEO's have psychopathic tendencies, often characterized by power-seeking behavior and dominance. These individuals can often conceal their ruthlessness and antisocial behavior behind

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1536-663: The expectations of their C-Suite colleagues. Many organizations have created a finance function based on four pillars: the accounting organization as a shared service; an FP&A organization responsible for driving financial planning processes as well as increased insight into financial and non financial KPIs to boost business performance; a finance business partnering organization based on leadership of divisions, regions and performance improvement; and expertise centers specializing in Tax, Treasury, Internal Audit, Investor Relations, etc. According to one source, "The CFO of tomorrow should be

1584-647: The federal government began preparing consolidated financial statements, the Government Accountability Office (GAO) reported that "major impediments continue to prevent [GAO] from rendering an opinion." In December 2006, the GAO announced that for the 10th consecutive year, the GAO was prevented from expressing an opinion on the consolidated financial statements of the government due to a number of material weaknesses related to financial systems, fundamental recordkeeping, and financial reporting. At

1632-603: The first attestation being in 1914. The first American usage cited is from 1972. The responsibilities of an organization's CEO are set by the organization's board of directors or other authority, depending on the organization's structure. They can be far-reaching or quite limited, and are typically enshrined in a formal delegation of authority regarding business administration . Typically, responsibilities include being an active decision-maker on business strategy and other key policy issues, as well as leader , manager, and executor roles. The communicator role can involve speaking to

1680-601: The government's financial management and develop standards of financial performance and disclosure. The Office of Management and Budget (OMB) holds primary responsibility for financial management standardization and improvement. Within OMB, the Deputy Director for Management, a position established by the CFO Act, is the chief official responsible for financial management. The Office of Federal Financial Management (OFFM)

1728-455: The majority of countries, finance directors ( FD ) typically report into the CFO, and FD is the level before reaching CFO. The chief financial officer was traditionally viewed as a financial gatekeeper. Over time, the position has become one of an advisor and strategic partner to the CEO. In a 2016 report released by McKinsey & Company , 88 percent of 164 CFOs surveyed reported that CEOs expect them to be more active participants in shaping

1776-542: The management responsibilities for internal financial controls in federal agencies and addressed to all federal CFOs, CIOs and Program Managers. The circular is a re-examination of the existing internal control requirements for federal agencies and was initiated in light of the new internal control requirements for publicly traded companies contained in the Sarbanes–Oxley Act of 2002. While significant progress in improving federal financial management has been made since

1824-409: The organization, the CFO is accountable for presenting accurate and fair financial statements, which are subsequently audited by the company's statutory auditors. Chief executive officer A chief executive officer ( CEO ), also known as a chief executive or managing director , is the top-ranking corporate executive charged with the management of an organization , usually a company or

1872-400: The organization. As a manager, the CEO presides over the organization's day-to-day operations. The CEO is the person who is ultimately accountable for a company's business decisions, including those in operations, marketing, business development , finance, human resources , etc. The use of the CEO title is not necessarily limited to describing the head of a company. For example, the CEO of

1920-521: The owners of business information, reporting and financial data within organizations and assisting in decision support operations to enable the company to operate more effectively and efficiently. The duties of a modern CFO now straddle the traditional areas of financial stewardship and the more progressive areas of strategic and business leadership with direct responsibility and oversight of operations (which often includes procurement ) expanding exponentially. This significant role-based transformation, which

1968-409: The point that their actions, personalities, and even private lives function symbolically to represent significant dynamics and tensions prevalent in the contemporary business atmosphere". Journalism thereby exaggerates the importance of the CEO and tends to neglect harder-to-describe broader corporate factors. There is little attention to the intricately organized technical bureaucracy that actually does

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2016-606: The post-holder is accountable for procurement success, and to become increasingly involved (directly via oversight or indirectly through improved collaboration) with the procurement function according to several research reports which have looked at the CFO's relationship with the procurement function and the CPO. CFOs and FDs often hold a professional accounting qualification - the CPA , CA , CMA , or CIMA - along with its requisite bachelors and/or masters in accounting . The certification

2064-450: The press and to the public, as well as to the organization's management and employees; the decision-making role involves high-level decisions about policy and strategy. The CEO is tasked with implementing the goals, targets and strategic objectives as determined by the board of directors. As an executive officer of the company, the CEO reports the status of the business to the board of directors, motivates employees, and drives change within

2112-512: The same time, in calendar year 2007, the CFOC announced that for the second consecutive year, every major federal agency completed its Performance and Accountability Report just 25 days after the end of the fiscal year (2006). As per the provisions of Section 203 of Companies Act 2013 every publicly listed firm having a paid up share capital of Rs. 10 Crores or more is mandated to have a whole time chief financial officer, who must also serve as one of

2160-538: The strategy of their organizations. Half of them also indicated that CEOs counted on them to challenge the company's strategy. The 1990s saw the rise of the strategic CFO, and many companies have created a chief strategy officer (CSO) position. CFOs have become more focused on financial reporting, although 52% still spend much of their time in traditional accounting tasks such as transaction reporting. The rise of digital technologies and focus on data analytics to support decision-making places more pressure on CFOs to meet

2208-409: The term "executive director" is used primarily in the not-for-profit sector. These terms are generally mutually exclusive and refer to distinct legal duties and responsibilities. The CEO is the highest-ranking executive in a company, making corporate decisions, managing operations, allocating resources, and serving as the main point of communication between the board of directors and the company. In

2256-457: The work. Hubris sets in when the CEO internalizes the celebrity and becomes excessively self-confident in making complex decisions. There may be an emphasis on the sort of decisions that attract the celebrity journalists . Research published in 2009 by Ulrike Malmendier and Geoffrey Tate indicates that "firms with award-winning CEOs subsequently underperform, in terms both of stock and of operating performance". Executive compensation has been

2304-802: The workplace. This perspective is explored in the book Snakes in Suits , co-authored by Robert D. Hare . However, Scott Lilienfeld has argued that the attention given to psychopathy in the workplace by both the media and scholars has far exceeded the available scientific evidence. Emilia Bunea, writing in Psychology Today , has linked psychopathic traits in managers to workplace bullying , employee dissatisfaction, and turnover intentions. Despite this, Bunea cautions that excessive worry about supposed psychopathic managers could discourage individuals from pursuing careers in corporations and deter employees from addressing issues with difficult bosses. In

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