The research by EY found that 58% of 19 public sector CFOs in the UK the ranked improving performance through the use of digital technology and analytics to improve performance and manage risk as their top strategic organisational priority. In second place was driving cost efficiencies through automation and outsourcing, which was citied by 26% of CFOs.
Darra Singh, head of UK government and public sector at EY, said the survey showed CFOs in the public sector were adapting to a changing role. They were, he said, “taking on more responsibility, and are becoming an indispensible part of leadership within local authorities, councils and Whitehall.”
Budgetary pressures, and the drive to do more with less, has “thrust the role into the spotlight”, Singh said, and CFOs are responding to the challenge in different ways. This includes the use of emerging technologies such as blockchain and sophisticated data analytics.
“We are seeing quite different profiles and responsibilities emerge when compared to the traditional idea of a public sector CFO,” he stated.
The report also revealed that CFOs are playing a more strategic role, in light of the fact that many public sector efficiency plans require changes to business processes and organisational structures. As such, financial heads are increasingly assisting chief executives and other organisational leaders in planning, testing and monitoring reforms. More than two thirds (68%) of respondents said they were spending more time providing analytics and insight to support senior leaders and decision makers than they were five years ago.
Furthermore, 63% of finance leads are spending more time supporting their organisation’s development and its strategic goals, while half (53%) agreed they were taking the lead in defining the overall strategy.
The results showed a significant sentiment supporting the notion of an impending ‘war for talent’, due to the expanded skill sets required from public sector finance leaders. As such, almost three quarters (74%) of respondents strongly agree that organisations are facing a growing talent challenge to finance leaders who can thrive in this new environment. Also, 90% said organisations will need to recruit from a more diverse talent pool in future.
According to Singh, recent rule changes around CFO qualifications have improved corporate governance and accountability. “It is still less than 10 years since government departments were first required to have in place a professionally-qualified finance director, reporting the permanent secretary and with a seat on the departmental board,” he said.
“This requirement has helped ensure good management and accountability in government finances at the top table, effectively helping to put finance at the heart of decision making.”
In the next five years, partnering across organisations is likely to become either ‘critical’ or ‘a significant priority’, according to 95% of survey respondents. This is likely to be one of the top goals for the finance operating model, with a focus on improving business partnering between finance bodies and other units and functions.
“Today’s CFOs are in a unique position to bring together a strategic view of the finances, performance and meeting future needs of their organisations. It is an exciting and challenging time to be a CFO in the public sector,” concluded Singh.
Participants in the report included Julian Kelly, the director general of public spending and finance at the Treasury, David Kuessenberg, the head of finance at the Department for Communities and Local Government, Ann Beasley, former director general of finance and corporate services at the Ministry of Justice and Jon Thompson, the chief executive officer at Revenue and Customs.
