What is the role of a Chief Financial Officer (CFO)?

What Is the Role of a Chief Financial Officer (CFO)?

The Chief Financial Officer is the most senior finance leader in a business: the executive who owns the company’s financial strategy, controls and reporting, manages its relationships with investors and lenders, and gives the board the financial judgement it relies on. In UK businesses the CFO typically sits on the executive committee, reports to the CEO, and — where appointed as a statutory director — carries personal legal duties under the Companies Act 2006.

That is the one-paragraph answer. The fuller picture depends on the kind of business the CFO sits in, because the role of a CFO in an owner-managed SME, a PE-backed portfolio company and a listed group are three genuinely different jobs sharing one title. FD Capital has recruited CFOs into all three since 2018, and this guide describes the role as it actually operates in UK businesses — not the textbook version.

The Core Responsibilities of a CFO

Financial strategy and planning. The CFO owns the financial plan: the budget, the forecast, and the model that tests whether the business’s ambitions are affordable. This is where the role earns its seat at the strategy table — a good CFO does not just report what happened, they shape what the business chooses to do next by showing what each option does to cash, profit and risk.

Reporting and control. Accurate, timely financial information is the foundation everything else stands on. The CFO is responsible for the management accounts the board runs the business from, the statutory accounts filed at Companies House, the audit relationship, tax compliance, and the internal controls that keep the numbers trustworthy. When this layer fails, nothing above it can be relied on — which is why rebuilding reporting and control is usually the first job of any incoming CFO.

Cash and capital. The CFO manages the company’s liquidity day to day and its capital structure over the long term: working capital, banking relationships, debt facilities and covenants, and decisions about how growth is funded. In funded businesses this extends to running fundraising processes and managing the investor relationship afterwards.

Risk management. Identifying what could go financially wrong — customer concentration, currency exposure, covenant pressure, fraud, systems failure — and making sure the business is protected proportionately. In larger organisations this is a formal framework; in smaller ones it is judgement applied consistently.

External representation. The CFO is the company’s financial voice to the outside world: investors, lenders, auditors, advisers and, in regulated firms, the regulator. Credibility with these audiences is a large part of what businesses are paying for at CFO level, and it is the hardest element to substitute.

Leading the finance function. The CFO builds and leads the team beneath them — typically a Financial Controller running operational finance, with management accountants, FP&A and transactional staff below. The shape of that team, and the systems it runs on, are the CFO’s design decisions.

For a formal breakdown of duties suitable for a hiring process, see our CFO job description guide.

How the Role Changes With the Business

In owner-managed and founder-led businesses, the CFO (often titled Finance Director) is the owner’s financial partner: hands-on with the numbers, close to operations, and frequently the commercial counterweight to an optimistic founder. Strategy here means pricing, margins, affordability and cash — not capital markets. The distinction between the two titles at this end of the market is covered in our guide to when to hire a Finance Director instead of a CFO.

In PE-backed businesses, the CFO runs the financial engine of the value-creation plan: board reporting to investment-committee standard, covenant and leverage management, add-on acquisition support, and preparation for exit. The sponsor relationship is a defining feature of the job, and prior hold-period experience is usually a hard requirement.

In listed and large corporate groups, the role is at its most external: market announcements, analyst and investor relations, group consolidation across entities, and formal governance under the UK Corporate Governance Code. The CFO here leads a large function and spends comparatively little time in the detail.

In FCA-regulated firms, the senior finance role carries a dimension the textbook definitions miss entirely: personal regulatory accountability. The CFO typically holds the SMF2 Chief Finance Function under the Senior Managers and Certification Regime, is individually approved by the FCA, and can be personally sanctioned for failures in their area of responsibility. Recruiting for this version of the role is a specialist exercise — see our SMF2 CFO recruitment page.

What Makes a Good CFO

The qualification base in the UK is usually chartered accountancy — ICAEW, ACCA or CIMA — though the letters matter less than what has been done with them. Beyond the technical foundation, the qualities we test for in every CFO search:

• Judgement under incomplete information — the real work of the role is making defensible calls before the picture is complete.
• Communication across audiences — the same numbers explained credibly to a board, a bank, a shop floor and an investor, each in its own register.
• Commercial instinct — understanding how the business actually makes money, not just how it accounts for it.
• Constructive challenge — the willingness to tell a CEO something they do not want to hear, delivered in a way that keeps the relationship working.
• Evidence of outcomes — specific things that improved because they were in the seat, not just seats held.

Full-Time, Fractional or Interim: How Businesses Access CFO Skills

A full-time CFO is no longer the only way to get CFO-level capability, and for many UK SMEs it is not the right way. A fractional CFO provides genuine ownership of the role one to three days a week — the standard route for businesses that need the judgement but not the full-time cost. An interim CFO covers a defined period at full intensity: a gap between permanent appointments, a fundraise, a restructure or a crisis. Permanent appointment remains right where the scale and complexity justify a dedicated hire — our CFO recruitment practice covers that search end to end.

On pay: CFO packages vary widely with business size, sector, ownership and engagement model, and benchmarks move with the market — our regularly updated CFO salary guide carries the current UK figures for permanent, interim and fractional arrangements.

When Does a Business Need a CFO?

The recognisable trigger points from our placement work: the founder can no longer personally hold the financial picture; external investment is being raised or has arrived; lenders or investors are asking questions the current team cannot answer with confidence; a transaction — sale, acquisition, MBO — is on the horizon; the business has become multi-entity or international; or the firm is entering FCA authorisation and needs an approved SMF2. If several of those apply and the honest need is two days a week rather than five, the fractional route is usually where to start.

The ICAEW is a useful further reference on the professional standards and duties that come with senior finance leadership in the UK.

Adrian Lawrence

Adrian Lawrence FCA is the founder of FD Capital and a Fellow of the Institute of Chartered Accountants in England and Wales (ICAEW). He holds a BSc from Queen Mary College, University of London, and has over 25 years of experience as a Chartered Accountant and finance leader working with private, PE-backed and owner-managed businesses across the UK. He founded FD Capital to connect growing businesses with the Finance Directors and CFOs they need to scale — and personally interviews candidates for senior finance appointments.