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Environmental and Social Pressures Expand Scope of CFOs' Roles

Environmental and Social Pressures Expand Scope of CFOs' Roles

A new Ernst & Young report has outlined several ways that CFOs can become directly involved in the sustainability efforts of their company in order to ensure the best possible management of the business.

The report, entitled "How sustainability has expanded the CFO's role", outlines the increased risks and opportunities associated with the environmental, social and governance issues that have arisen in recent years. Executives may see their role evolving in three areas including investor relations, external reporting and assurance and operational controllership and financial risk management.

Executives need to bridge the gap between the rest of the company and the sustainability measures, as the financial organization needs to be informed so that the necessary steps are taken to maximize profits when adhering to rules and regulations, according to the report.

Robust sustainability reporting can help to enhance the dialogue with shareholders and improve the disclosure in key areas relating to the environment. This may help to create a preventative system as opposed to a reactionary one, the release noted.

CFOs need to make sure there is a consistency in their reporting, especially when it comes to sustainability and the environment, as any discrepancies between departments could create regulatory issues that may cost the company revenue, according to GreenBiz.com. 

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