Chief financial officers are increasingly collaborating with their chief information officers to manage cybersecurity, establish IT strategies and processes, transition to a digital IT function, and create an analytics-driven organization, according to Ernst & Young’s global survey of 652 CFOs and other financial leaders released Tuesday.

However, CFOs also said their relationships with CIOs are challenged due to their lack of understanding of IT issues, and “their prevailing view of IT as a cost center, rather than as an asset,” E&Y found.

“In today’s digital economy, the financial well-being of an enterprise is dependent on the health of the CFO-CIO relationship,” Julie Teigland, E&Y’s Europe, Middle East, India and Africa CFO program leader, said in a press release. “To succeed, organizations must make bold technology investment decisions that are driven by corporate strategy, while managing a range of severe risks, such as cybersecurity and data privacy concerns.”

Two-thirds of the CFOs surveyed said managing cybersecurity is a high or very high priority, but nearly half (44%) said a lack of understanding of IT issues to appropriately invest in cybersecurity capabilites was one of the top obstacles to forging a closer working relationship with the CIO.

“The tendency for CIOs to discuss cybersecurity issues in technical jargon, rather than business language, can also block fast decision-making and action,” the authors wrote.

Ultimately, cybersecurity management must be treated an enterprise risk management issue, rather than an IT one, and CFOs should lead the board-level discussion to prioritize which assets are business-critical to protect.

“Cybersecurity preparation is all about understanding what the business is trying to protect,” but “some CFOs are trying to understand the technical detail when they shouldn’t be,” E&Y’s global cybersecurity leader Ken Allan said. “CFOs should also ensure the whole organization has a tested plan in place to ensure they are ready to respond when the inevitable breach occurs.”

More attention is needed to switch digital IT investment from capital outlays to operational expenditures that include Software-as-a-Service and other cloud-based services paid for on an as-needed basis, EY concluded.

Among the 652 CFOs surveyed, just fewer than 50% of those who have made transitioning the IT function to a digital world a very high priority reported EBITDA growth of greater than 10% over the last three years. Only 35% of CFOs who have not made transitioning the IT function to a digital world achieved the same level of growth.

The number one reason why increased collaboration between CFOs and CIOs is important is to improve analytics and data management capabilities to drive financial and strategic decision-making, E&Y said. Still, only 53% of CFOs said they make a significant contribution to determining where analytics can add most value to the organization.

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One response to “CFOs Collaborating More with Their CIOs”

  1. CFOs have a unique opportunity to lead their organization on managing cybersecurity threats. They are expected to provide risk management across a wide range of areas, so they are willing to identify and consider more options than the typical CIO will.

    For example, in my experience the CIO is more likely to advocate building in-house web apps that will store customer credit card information (wildly risky!) and is less likely to consider whether an outside service provider can do the job better with less risk.

    CFOs lacking in confidence on the subject of cybersecurity should find a subject matter expert that will unconditionally coach and support them as they grow their understanding and capabilities.

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