3 traits of successful finance leaders
In recent years, the view of what makes a good leader has broadened — the general leading an army is now one of a whole portfolio of leadership styles. It means that top jobs can accommodate a variety of personalities and personal qualities. And leadership is better for that diversity of approach.
What are the qualities you value in leaders? Determination? Certainty of purpose? Vision?
For me, three qualities stand out in a good leader. First, an effective leader is someone who can "join the dots" between functions in their organisation. This is a quality that is not as common as it ought to be, since it requires a broad mix of skills. You need to know your business inside out, including the people, their tasks, and their skills. To do this means communicating clearly and driving performance with the right key performance indicators.
This is good news for those of us in the finance function, as systems thinking is what we are good at. We do not just produce the annual accounts, we collect data and gather insights. We have a unique view of where the money goes — or does not go. We know what happens when it is added or removed. It helps us see where businesses can be improved, which is what leaders are meant to do. Career-wise, you are in a great position to make the move to the C-suite.
This skill means we are well placed to make a success of Integrated Reporting (IR). This is something we at the Association have embraced fully because we strongly believe that being able to show the value a business creates — and communicating that in as complete a way as possible — is the future of corporate reporting. IR is a good way of blending the skills of the finance function with the company's broader ambitions.
Second, leadership is knowing what to measure to achieve success. Leaders need to be keenly attuned to setting the right targets — set an ambitious target and pursue it relentlessly is my mantra — and give those targets to the right people. If you can give people the opportunity to properly use their strengths, and to excel, you will soon see the benefits.
Third and finally, my view is that leaders should be allowed to feel emotions, too — controversial, I know. For that, resilience is fundamental. It is a skill which, if you keep practising it, will serve you well when you reach the top. The image of the leader impervious to setbacks or criticism is unrealistic. It is a recipe for poor mental health and sets the wrong example. Resilience means being able to recover when things go wrong, learn lessons, and move on positively. Then repeat. Anything else lacks authenticity.
Nearly everyone can be a leader, but knowing your business, understanding what to measure, and using emotional intelligence is a strong formula that will make you stand out.
Andrew Harding, FCMA, CGMA, is chief executive—Management Accounting, at the Association of International Certified Professional Accountants.