IMA Releases New Reports on the Role of CFO in Sustainability
Stern Strategy Group
- A C-suite report, “CFO as Value Creator: Finance Function Partnering for the Integration of Sustainability in Business”
- A white paper, “CFO as Value Creator: Finance Function Leadership in the Integrated Enterprise”
The C-suite report paper explains how the CFO and the finance function can meet stakeholder demands regarding the integration of enterprise-wide sustainable business goals and activities by effective partnering with the company’s sustainable business team and other business units. It provides a practical framework for finance and accounting professionals to serve as active business collaborators in sustainability initiatives.
The C-suite report builds on a joint paper from IMA and ACCA (Association of Chartered Certified Accountants) written in 2014 that establishes an approach – the Finance Partnering Framework – to help the corporate finance function lead cross-discipline collaboration to achieve shared organizational goals. Applying this framework to integrating sustainable business initiatives, the C-suite report provides three components for successful partnering:
- Create a mandate for partnering on sustainable business activities
- Fix the information by enhancing quality of data insights
- Deploy the talent with the mindset to meet challenges
“For years, there has been a perception that mainstream corporate finance and accounting professionals are uninvolved in sustainable business. While this is still the case at some companies, the majority are taking steps toward integrating new sustainable business initiatives, said Shari Littan, CPA, JD, manager of corporate reporting technical activities at IMA and co-author of the reports. “We observed that the leading companies that have made the most progress actually involve the CFO and finance function significantly.”
The white paper, which supports the framework articulated in the C-suite report, reflects qualitative interviews with senior executives in multiple industries. It provides the basic insights about the finance professional’s role in sustainable business.
The white paper tracks the evolution of the CFO’s role from one that emphasized compliance to one focused on governance, strategy, and operations, consistent with companies increasingly incorporating sustainable business activities and adopting integrated enterprise approaches. Collaboration between teams throughout the organization – finance, sustainability, and human resources, among others – allows businesses to better analyze financial and nonfinancial performance.
“For the white paper, we went and spoke to professionals from large companies that are noted for this progress,” continued Littan. “We asked what IMA’s primary constituents – accountants and finance professionals in business – are actually doing to help their organizations with these activities, and we learned that they are quite involved, much more than even we expected. What we learned from these interviews is that the CFO and finance function are developing internal processes that allow them to bring their expertise and specialized skill set to work across the organization.”
The market report identifies several functions that CFOs and finance and accounting professionals serve within an integrated enterprise:
- Connecting sustainability performance measurements to value
- Improving internal and external reporting
- Enhancing information quality through oversight of internal controls
- Managing risk in relation to sustainable business initiatives
- Improving supply chain oversight
To read the full reports, visit here.
About IMA® (Institute of Management Accountants)
IMA®, named the 2017 and 2018 Professional Body of the Year by The Accountant/International Accounting Bulletin, is one of the largest and most respected associations focused exclusively on advancing the management accounting profession. Globally, IMA supports the profession through research, the CMA® (Certified Management Accountant) and CSCA® (Certified in Strategy and Competitive Analysis) programs, continuing education, networking, and advocacy of the highest ethical business practices. IMA has a global network of more than 125,000 members in 150 countries and 300 professional and student chapters. Headquartered in Montvale, N.J., USA, IMA provides localized services through its four global regions: The Americas, Asia/Pacific, Europe, and Middle East/India. For more information about IMA, please visit www.imanet.org.