From automation to labor shortages, here’s what mattered to CFOs this week
Good morning. This is Fortune’s Rey Mashayekhi, filling in for Sheryl while she takes a well-deserved break.
Here’s what happened this week:
Like many companies, insurance giant Prudential didn’t have the greatest year in 2020 from a results standpoint. But as Prudential CFO Ken Tanji told us, it was also a year of transformation for the 146-year-old company—one that accelerated its shift toward tech-enabled automation that has made its operations “nimbler and faster” and improved the customer experience. “Probably less than 20% of our underwriting or new policy approval process was automated [before the pandemic], to now, over 80%,” he noted.
These are fraught times in the realm of cybersecurity, with multiple major ransomware attacks this year having displayed the threat on hand for businesses of all sizes and industries. “I don’t see it stopping anytime soon,” according to Pam Nigro, vice chair of the board of directors at IT professional association ISACA. In Nigro’s view, CFOs are uniquely equipped to help their companies grasp the cost-benefit calculus behind improving their IT security systems. “CFOs naturally understand risk and understand what is acceptable in terms of thresholds for dollars,” she said. They can then “carry that message up to the CEO and ultimately to the board, and help the board understand the level of risk.”
Accounting giant EY’s latest Global Board Risk Survey provided a window into how board members at organizations with $1 billion-plus in revenues are thinking. Not surprisingly, the pandemic appears to have left a real impression; 79% said improved risk management in the coming years will be critical to protecting and building value, while 83% said market disruptions are playing an increasingly impactful role in how their businesses are run.
And the latest CFO Survey from Duke University’s Fuqua School of Business (in conjunction with the Federal Reserve Banks of Richmond and Atlanta) showed the extent to which labor-related issues are weighing on the minds of companies’ financial decision-makers. Labor quality and availability ranked as executives’ most pressing concern, with more than 21% of respondents describing it as such (compared to less than 11% in the previous quarter’s survey). What’s more, over half of the CFOs that reported challenges finding workers said those labor constraints have hindered their firms’ revenues.
That’s all for now. Have a wonderful weekend and see you on Monday.
The numbers are in, and they show that companies with more diverse boardrooms perform better. That’s according to an Axios report spotlighting data provided by the nonprofit BoardReady, which tracked S&P 500 companies’ revenue figures in 2020 and found that those whose boards were younger, less white, and more female fared better than their predominantly old, white, and male counterparts.
While the data adds to a growing body of research indicating that the more diverse a company’s leadership is, the better its results, it’s worth noting that the data doesn’t exactly prove that those companies did better because of their diversity. “There isn’t enough data yet to show causation, but there’s strong correlation,” BoardReady founder Deanna Oppenheimer told Axios.
Here are a few Fortune reads for the weekend:
Mercedes earnings show that the car chip shortage hasn’t been all bad for automakers by Christiaan Hetzner
Some notable moves from this past week:
Daryl Raiford was named CFO at Bandwidth Inc., a cloud communications company. Raiford will join Bandwidth on July 12 as executive vice president. He is expected to succeed Jeff Hoffman as CFO in August. Raiford most recently served as CFO at Ribbon Communications.
Melissa Schaeffer was named SVP and CFO at Air Products, an industrial gases company, effective August 10, 2021. Schaeffer succeeds EVP and CFO Scott Crocco who is retiring on September 30. Schaeffer joined Air Products in June 2016 as vice president, chief audit executive. She was appointed vice president, Finance—GEMTE (Americas, Middle East, and India) in 2020.
Vikas Mehta was named CFO at Anaplan, Inc., a cloud-native platform provider, effective July 19. Most recently, Vikas served as CFO of Nike’s direct business leading both digital and the direct-to-consumer transition. He has also held leadership roles at Microsoft, Walmart eCommerce, eBay, and Autodesk.
Ed Tang was named CFO at Pindrop, an information security company that analyzes phone calls to detect risk, effective immediately. Tang succeeds the position from Jeff Hodges. Since 2019, he has served as the CFO of Lever, a talent acquisition platform. Tang also served in leadership positions at Salesforce and Box.
“The role of the CFO, over the course of the last 10 years has evolved to be a more strategic role, and a different type of role than it was.”
—New Morgan Stanley CFO Sharon Yeshaya, speaking to Bloomberg ahead of her first earnings call as the Wall Street bank’s top financial executive.
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