2024 CFO Study: A Travelers Special Report
Inside the minds of CFOs: A deep understanding
Chief Financial Officers of large companies are sophisticated insurance buyers with accountability to determine which risk financing solutions are right for their business. To learn more about the challenges they face, we surveyed 610 CFOs in insurance decision-making roles for companies with 500+ employees across a mix of industries.
We asked them about topics ranging from macroeconomic concerns to internal issues. We learned their fears about talent shortages and post-pandemic workforce dynamics as well as the role insurance plays in their companies’ success.
What the survey revealed about how they’re dealing with exposures as well as the partners they rely on for risk management may surprise you with insights that can help you better serve this otherwise difficult-to-reach audience.
Source: Travelers CFO Study, 2024
Macroeconomic factors: Top CFO concerns and optimisms
An undercurrent of worry about economic uncertainty, competition and inflation is balanced by the CFOs’ optimism about their companies’ financial strength, their customer base and how technology (like AI) will bring efficiencies to their business over time. They’re confident in their companies’ actions to invest in digital capabilities and emerging technology.
"When facing business challenges and uncertainties, we need to maintain a positive attitude and constantly learn and innovate to lead the company’s growth."
- CFO, Transportation, <1,000 employees
Top 10 factors of greatest concern
Economic uncertainty | 33% |
Market competition | 33% |
Talent acquisition and retention | 32% |
Inflation | 30% |
Customer satisfaction/retention | 27% |
Financial stability of your company | 26% |
Cybersecurity | 24% |
Interest rates | 21% |
Public policies and regulatory compliance | 20% |
Employee satisfaction and engagement | 19% |
Source: Travelers CFO Study, 2024
Top 10 factors of greatest optimism
Financial stability of your company | 41% |
Corporate reputation | 37% |
Customer satisfaction/retention | 32% |
Artificial intelligence (AI) | 30% |
Employee satisfaction and engagement | 29% |
M&A activity | 24% |
Talent acquisition and retention | 23% |
Shareholder satisfaction | 21% |
Your company's intellectual property | 20% |
Diversity and inclusion | 20% |
Source: Travelers CFO Study, 2024
Upskilling: CFO skills needed now and in the future
The evolving skillset of the CFO
Whereas the CFO role has historically focused on financial reporting, a trend continues toward developing multiple level partnerships to influence the C-suite and manage business risk. This will require a new level of charismatic leadership, communication skills and emotional intelligence.
"What’s changed over the last 20 years is the role of CFO to be more of a business partner – helping the board and the CEO actually manage the business."
- CFO, Private Manufacturing, 1,000+ employees
"As I’ve let go of the accounting nature in my past and really gotten more operationally forward-thinking, I think that helps propel the organization. It makes me a good partner to my CEO."
- CFO, Private Healthcare, 1,000+ employees
Most valuable skills needed
Strategic planning for future company success and resiliency | 62% |
Ability to manage a complex network of internal and external stakeholders relationships | 52% |
Identifying and mitigating various business risks | 52% |
Charismatic leadership and strong communication skills | 48% |
Use of tools and dashboards for advanced data analytics | 44% |
Building advanced technologies for organizational resilience | 39% |
Ability to respond to disruption from technology or other industries | 39% |
Staying updated on financial regulations | 37% |
Emotional intelligence and experience in people issues like diversity and well-being | 36% |
A willingness to champion continuous learning | 33% |
Source: Travelers CFO Study, 2024
M&A effects on CFO roles and responsibilities
Mergers and acquisitions activity among the businesses we surveyed has been strong and shows little signs of slowing. While good for business growth, it opens companies up to new risks and new responsibilities for the CFO – the greatest impacts coming from increased workload, integration involvement and strategic development.
"The process of assessing and managing financial risks became more complex. I had to identify and mitigate potential risks associated with the integration."
- CFO, Public Healthcare, <1,000 employees
The impact of M&A on CFO responsibilities
12%
No impact
18%
Slightly impacted
41%
Moderately impacted
29%
Highly impacted
Source: Travelers CFO Study, 2024
2024 will be much of the same
37%
We are not actively pursuing acquisitions.
54%
We are open to acquiring a company that is the right fit.
9%
We are actively looking to be acquired.
Source: Travelers CFO Study, 2024
The workforce: National trends in hiring and retention
Workforce concerns
As the labor market continues to tighten and unemployment remains low, it puts pressure on companies to invest in employee development and be thoughtful about workload and overall well-being. The post-pandemic hybrid work environment is also a concern they need to manage.
"We cannot find skilled trades people; we probably bumped our hourly salaries 12% in total over the last couple years.”
- CFO, Private Manufacturing, <1,000 employees
Post-pandemic workforce challenges
Talent retention and acquisition | 44% |
Rising cost of labor | 43% |
Employee expectations | 33% |
Talent shortage | 33% |
Hybrid and remote work environment | 32% |
Employee reskilling and upskilling | 29% |
Risk management | 26% |
Capacity management/workload | 22% |
Well-being of employees | 20% |
Succession planning | 20% |
Source: Travelers CFO Study, 2024
Lack of succession planning can leave companies exposed
32%
Have no plans. Firms with no risk manager/team are significantly more likely to have no plans (41% vs. 27%, respectively).
30%
Have begun planning but haven't implemented.
19%
Developed plans but successor hasn't been identified.
19%
Developed and implemented plans and successor has been identified. Firms with $500M+ in net revenue are significantly more likely to have a plan developed and successor identified.
Source: Travelers CFO Study, 2024
How much risk management is proactive vs. reactive?
Among the companies we surveyed, CFOs mentioned that almost two-thirds of their risk management activities are proactive in nature. That means over a third of their risk management is reactive in that they don’t implement a new process until after an incident has occurred.
62%
Proactive
38%
Reactive
Source: Travelers CFO Study, 2024
CFOs rely on internal and external stakeholders
CFOs are partnering with risk managers, insurance brokers and carriers, CIOs, CTOs and human resources, to help them manage risk – with themselves at the center of the decision-making process. While most companies have established best practices for mitigating and responding to risk, carriers can play a key role by analyzing data available for their industry.
“I think of myself with the CEO as a thought partner when it comes to things that go way beyond just financial insights. It’s thinking about risk, business continuity and potential costs down the line."
- CFO, Private Technology, 1,000+ employees
Other partners CFOs rely on for risk management
Risk manager | 60% |
CIO | 40% |
Insurance agent/broker | 40% |
Insurance carrier | 35% |
Human Resources | 33% |
Source: Travelers CFO Study, 2024
Contact your Travelers account executive or visit: travelers.com/business-insurance
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