5 Trends Finance Leaders Should Add to Organizational Strategy

As the financial landscape continues to evolve, chief financial officers (CFOs) and other finance leaders must stay ahead of the curve to effectively manage their organizations' financial health and strategic direction. Emerging technologies are changing the future of finance at an unprecedented pace, which is having a meaningful impact on the role of finance leaders across organizations and industries. They are still expected to serve as traditional stewards who uphold financial and regulatory requirements and generate insightful financial reports for senior executives, boards and third parties. But today’s CFO is also expected to lead the technological transformation charge, using data-driven analysis and forecasting capabilities to inform decisions. Instead of looking to the past to explain what happened, the role has shifted to a forward-thinking mindset.

The first half of the year has seen an increase in artificial intelligence and generative AI (Gen AI) solutions launched in the market; these tools seek to improve aspects of financial management and traditional accounting. These advancements in technology should be equally considered with other macro trends, regulatory requirements, and the company’s vision.

Here are five trends that finance leaders should pay attention to as we close 2024 and start preparing for 2025:

1. Digital Transformation and AI Integration

Digital transformation is no longer a future goal but a present necessity. CFOs must embrace AI, Gen AI and advanced analytics to streamline financial processes, enhance decision-making, and drive efficiency. AI can automate routine tasks such as data entry, reconciliation, and reporting, freeing up time for more strategic activities. Predictive analytics, powered by AI, can provide CFOs with real-time insights into financial performance, helping to forecast trends and identify potential risks.

Key Takeaway: Understand the AI landscape and what use cases make sense to explore in the short versus long term at your company, then come up with a roadmap.

2. Sustainability and ESG Reporting

Environmental, social, and governance (ESG) considerations are increasingly influencing investment decisions. Investors, regulators, and stakeholders demand greater transparency and accountability in sustainability practices. CFOs must integrate ESG metrics into their financial reporting and demonstrate how their organizations are contributing to sustainable development goals. This includes measuring carbon footprints, ensuring ethical supply chain practices, and promoting diversity and inclusion.

Key Takeaway: Prioritizing ESG initiatives can enhance reputation, attract investment, and ensure compliance with evolving regulations.

3. Cybersecurity and Technology Risk Management

With the rise of digital finance, the threat of cyberattacks has become more prominent. In addition, as we just witnessed with the recent CrowdStrike outage in July, global organizations are heavily dependent on software and security providers to enable their operations, and when those companies experience issues, CFOs and other senior executives must be ready to act. CFOs must prioritize cybersecurity and risk management programs to protect sensitive financial data, avoid significant disruptions, and maintain trust with stakeholders. Implementing robust risk management frameworks, conducting regular security audits, and investing in advanced technologies are essential steps.

Key Takeaway: A strong cybersecurity and technology risk management strategy is vital for safeguarding financial assets and maintaining business continuity.

4. Human Capital Dynamics

By now, many companies have gone to fully or mostly in-person work models. However, the same companies still rely on teaming and collaboration applications to drive productivity. Additionally, over the past years, several industries experienced layoffs, real estate footprint reassessments, and shifting in roles, for instance, having a shared services team to do accounts payable, payroll, accounting and other corporate functions in low-cost countries in Asia and Latin America. These factors are shaping up how Finance leaders staff their teams for growth across geographies.

Key Takeaway: Set the tone on how the finance organization will be scaled to attract and retain talent while considering evolving skills needs.

5. Focus on Financial Agility and Resilience

In an era of economic uncertainty, financial agility and resilience are paramount. CFOs must develop strategies to navigate volatility, manage liquidity, and ensure access to capital. This involves scenario planning, stress testing, and maintaining a robust cash flow management system. Building strong relationships with financial institutions and exploring alternative financing options can provide additional financial stability. Agility in decision-making and the ability to quickly pivot in response to market changes will be key to sustaining growth and profitability.

Key Takeaway: Enhancing financial agility and resilience prepares organizations to withstand economic shocks and seize opportunities in a dynamic market environment.

As we move into the last months in 2024, CFOs will face a complex and rapidly changing financial environment. By focusing on digital transformation, sustainability, cybersecurity, technology, human capital, and financial resilience, CFOs can navigate these challenges and drive their organizations toward sustainable growth. Staying ahead of these trends while proactively adapting strategies will be essential for maintaining a competitive edge.