CISOs, CSOs, and CIOs are not the only C-level executives with a deep concern about cyber security. New research shows that CFOs appear to be taking a more active role in ensuring that their organizations are protected against data breaches, hacks, malware, and other threats.
This development should come as no surprise, with cyber security continuing to become a bigger priority for many organizations. There’s been evidence of more boards of directors taking a greater interest in security issues. And as the top finance officers within organizations, CFOs certainly have a lot at stake in keeping valuable information assets safe and avoiding penalties for non compliance with data privacy regulations.
A report by global consulting firm Protiviti, “Today’s Finance Priorities: Security, Data, Analytics and Internal Customers,” shows the continuation of a significant shift in the priorities and activities of CFOs and other senior finance executives, driven in large part by the growing emphasis of treating data as a major corporate resource.
“CFOs and finance executives are more determined than ever to exceed the increasing expectations of internal customers,” the report said. “They are more concerned with data security, privacy and governance. They are more focused on robotic process automation [RPA], artificial intelligence [AI], blockchain, predictive analytics, cloud-based applications, and other advanced technologies.”
These executives want to make their financial planning and management reports more insightful to more stakeholders, the study said, and they are embracing and espousing a more strategic mindset and operating model.
This is good news for organizations, the report notes. Doing more is necessary, given how much more complex the business, economic and geopolitical landscapes have become in just the past year. As new opportunities and new threats—such as data breaches—appear, organizations are counting on their CFOs and finance teams to drive the behavioral changes needed.
For its research, Protiviti surveyed more than 800 finance leaders worldwide, including CFOs, vice presidents of finance, and a range of finance directors and managers, during the second quarter of 2019. A large majority of the respondents (84% of CFOS and vice presidents of finance) cited security and data privacy as a high priority.
Given the prevalence of data breaches hitting organizations today, the report said, it’s understandable that security and data privacy are ranked as a priority for finance teams to focus on during the next year.
“A data breach—whether related to financial or nonfinancial data—can have severe financial and reputational ramifications,” noted Chris Wright, a Protiviti managing director and global leader of the firm’s Business Performance Improvement practice. “And as cyber risks increase, finance leaders must adequately budget, allocate resources, and prioritize company-wide security and data protection measures.”
A greater interest in cyber security among CFOs is part of a broader trend toward finance executives becoming strategic leaders at organizations.
More than 70% of CFOs and vice presidents of finance view strategic planning as one of the highest priority areas in which they want to improve their knowledge and capabilities. This highlights the need for these finance leaders to focus on strategic matters as much as operational and day-to-day finance and transactional matters, the report said.
“The data-driven nature of today’s finance function makes the CFO invaluable in setting and executing the company’s strategy, especially when it comes to forecasting trends or managing government and regulatory relationships,” Wright said. “These finance leaders are no longer siloed to financial and operational issues; rather they’re expected to deliver insights and analysis that help shape critical business decisions.”
Strategic decision-making within organizations is being informed by data more than ever, the study said. And as a result of this, the CFO’s internal customers are increasingly requesting that the finance function provide real-time information with specific insights, metrics and enhanced data analytics about the organization’s financial and operational performance.
Nearly 80% of CFOs and vice presidents of finance cited enhanced data analytics as a priority for the finance function to improve its knowledge and capabilities over the next year, to help them exceed their internal customers’ expectations. Meeting the changing demands and expectations of internal customers is also a top area driving finance workforce increases.
While some security executives might view CFO involvement in cyber security planning and execution as an intrusion, overall it could lead to better protection of data resources.
“We see that finance leaders want to optimize security and data management capabilities and improve how they meet the rapidly changing expectations of a growing body of internal customers,” the report said. “They realize that failing to make progress in protecting and leveraging data assets, whether on-premises or in the cloud, and [not] addressing the needs of internal customers could result in a failure to meet the business’s strategic-level expectations.”