The relationship between the CEO / Founder / Owner of a small- or medium-sized business is crucial. For startups in Silicon Valley, there are unique pressures from many different sources (e.g., VCs) that require a strong partnership with a CFO. Similarly, for a traditional, non-tech SMB in the San Francisco Bay Area, a tight business relationship between the CEO and CFO is also critical in order to navigate the growing number of strategic and financial issues.
The interview below with the COO / CFO of Deloitte highlights some of these nuances. Here are some relevant excerpts from the interview:
“Q: What are the basic attributes of a strong CEO-CFO relationship?
Frank Friedman: Trust. Does the CEO trust you to have their best interest and the company’s best interest at heart? Does the CFO trust the CEO to do the same? There’s also communication. There should be regular ongoing dialogues to ensure that both operate with the same knowledge.
Q: What would you tell CFOs who want to contribute more to strategy, and why should CEOs seek their support?
Frank Friedman: Again, it goes back to trust as the CEO decides in what capacity to use a CFO beyond their day-to-day CFO issues and when. To lay the groundwork for greater involvement in strategy setting, it’s important that CFOs offer their CEO assistance in any way they can.
At the same time, if CFOs are not at the table when every strategic decision is made, they are not doing their job, and candidly the CEO is not doing his or her job. The CEO comes in to every situation with built-in biases. If a CEO doesn’t seek the CFO’s strategic view, the CEO could be missing a key ingredient that could impact meeting the objective. Both fortunes are tied together.”