The responsibilities of new age Indian CFOs Inc has gone up substantially in today's modern Indian business environment in comparison to what was demanded traditionally.

Indian companies in particular that have grown global in their market presence and have the challenges of handling multitude of cultures, laws, compliance requirements and business practices. A home grown CFO needs to have a short learning curve on several of these issues and has to perform on par and better than his global counterparts in competing organizations. The CFO meet focused on various aspects of the Entrepreneurial CFO, namely ‘Beyond Control and Compliance', ‘Succeeding in a Global Environment' & ‘Nurturing Talent‘.

Here are excerpts from Mr. Som Mittal's address.

Som Mittal, who is slated to be the next head of NASSCOM started his keynote address by stating that today's CFO is no longer a backend boy. He is a key strategist who decides many aspects of business policy including cost management. Whether at a small, mid-sized or large business, the role of the CFO in corporate India has changed considerably in recent years. It is no longer good enough to simply be the smartest number cruncher in the world. The CFO today has to be accountable for more than just accounting. The CFO is quickly becoming the person upon whom many boards now depend for answers. Although CEOs are still firmly piloting the ship, most of their orders of late seem to be landing on the CFOs desk. Few business roles have changed as dramatically during the last generation as that of the CFO. The CFO is today more of a business partner with the CEO, closely involved in designing and overseeing strategy, operations, and performance.

Mr Mittal spoke at length on the changing role of CFO. Mr Mittal defined entrepreneurship as taking daily decisions with risks, inspite of not having all the information to take that decision. To many people, the term ‘entrepreneurial CFO' seems oxymoronic, but is infact a truth of modern India. Conventionally, the CFO was a number crunching individual, who had no emotion and was only bothered about the bottomline. He was supposedly the Dr No of the organization. Today's CFO plays many more roles such as stewardship, operator and strategic catalyst. Traditional financial tools may not be enough for today's CFO to fulfill his role in the company.

With the advent of globalization in India, Mr Mittal felt that we have a huge opportunity in our hands, which the young people should utilize. Dramatic changes are occurring every instant, and we are seeing opportunities that we have never dreamt of. Mr Mittal advised that although the opportunities we have are huge, the cost to delay decisions have been high.

Traditionally a product is manufactured in a factory, but now the business model is a concept, and the idea of a factory does not exist anymore. The IT revolution to the business model, has added new pressure to the role of a CFO.

Mr Mittal also noted that our aspirations have changed. Some time ago, NASSCOM had declared that most companies world over have made India their preferred destination. Now Indian companies are going global and we are no longer talking about the next budget of Finance Minister Chidambaram. Gone are the days when businesses used to wait for the Indian budget to happen. We talk about new markets and in such a scenario the CFO has to mitigate the risks involved and encourage innovation.

The CFO also has to ensure that the value system of the company remains intact, although the charter may change. The CFO has to be flexible in his mindset and spot the opportunities available. Mr Mittal believes that the financing role has changed by leaps and bounds. Earlier it was hard for a CFO to get funds, but today banks are running after the CFO with loan proposals. Therefore the CFO of today, has the resources to acquire money unlike the yesteryears.

The modern CFO runs treasury operations and is in charge of making investments as well. The CFO also ensures that the company invests in non core business. The role of the CFO is getting redefined and many CFO's in the country handle tasks such as compliance to SOX regulations. Legal responsibilities and compliance monitoring in key areas such as contract law, employment law and company and securities law have also traditionally been grouped with the CFO. Since today's market is very fickle minded, the CFO has to take decisions by balancing both long term and quarterly goals.

Today's CFO faces newer pressures than ever before and he has to look out for nuances that he is not used to. The impact of technology has changed the role of the CFO, especially in terms of data analysis. Mr Mittal made a powerful statement; when he stated that the power is not in the data but in the analysis of data.

In terms of the skills a CFO should possess, Mr Mittal said that a CFO has to be the conscience keeper of the company. A CFO should not isolate himself, but should make all decisions inclusive. A CFO should ideally have knowledge of the industry, infact he should go down into the trenches with the employees and learn the business by dirtying his hands. In terms of a CFO‘s behavioral aspect, Mr Mittal stated that he should no longer be introverted or conservative. He should be open to criticism and encourage open dialogue in the organization.

The modern CFO has to be good at networking and should attend CFO forums to exchange ideas. Traditionally only the marketing person did the wining and dining of clients, but now the CFO has to do the same. The CFO could also train the business development folks and board members on financial matters, so that there are fewer escalations to the finance department. The CFO must be an agent of change to help challenge the status quo, to understand trends, to be questioning the business model, and to help move the organization forward. A CFO should never be too content with today's success. What about tomorrow?

Som Mittal ended his candid speech with inspiring thoughts on how it's the responsibility of every CFO to develop the people in the company. The modern CFO has to have the mindset of an entrepreneur and will be able to successfully support the CEO & CTO in running the organization effectively and successfully. These trends have been gathering pace and non-finance executives are now accustomed to this newly empowered CFO. They are recognizing that, the finance function can and should play a significant role in evaluating new opportunities, providing organization information and collaborating with other functions to achieve deliberate goals.

The conventional transaction processing and core number crunching is still going to be a component of the CFO role but the time spent on this aspect of the job will continue to decline as further improvements and enhancements are made to the systems and processes. At the end of the day, the CFO is a team member first, serving as a bridge between business line units, management, the board and stake holders. The old-school days of simply being a glorified bookkeeper are, long gone.

Mr. Som Mittal was speaking at the CFO Meet on the theme ‘Being an Entrepreneurial CFO',  organized by the Confederation of Indian Industry (CII), Karnataka

Compiled by Rajiv Mathew who is a dreamer willing to tear down walls, build bridges, and light fires to make his dreams come true. He has a bit of that "vision thing" and is not afraid to start from the beginning.

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