Q and A: The CFO-Board Relationship with Wendy Libby

Wendy B. Libby is president emerita of Stetson University and has served as a chief business officer before becoming president. She offers her thoughts on the CFO-board relationship, why it matters, and the hardest part to get right.

How should CFOs think about their governing board and, related, the investment, facilities, and finance and audit committees?

The CFO will spend more time with board members than any other senior leader at the institution, with the exception of the president. As a result, the CFO's capability will echo throughout the board: if the board believes the CFO knows what's going on and has the ability to lead and manage, all board business will be much easier.

That said, it's important to remember that the CFO reports to the president, not the board! While a CFO's knowledge and expertise can elevate the work of governance, they ultimately work for the president.

What do boards want from the CFO?

Honesty, integrity, and a heads-up when there is a problem--or an opportunity! If it's the former, what recommendations does the CFO have for solving it? If it's the latter, how can the opportunity fit into the strategic plan?

What is a common mistake CFOs make when it comes to their board? Why do you think that's common?

The hardest thing for any CFO is setting the right tone in regards to authority and decision-making. When a CFO works closely with the president and board members, the process is collaborative, which means the CFO must walk a fine line. In these instances, CFOs need to own their areas of expertise and command their data.

I think this problem occurs frequently because most CFOs have gained their experience and knowledge by serving for many years in a staff role. While this makes for great subject-matter expertise, it doesn't prepare them for interactions with some of the high-powered individuals on the board.