Wake to small daughter wanting attention; shout hasty instructions at domestic staff (i.e. my husband) while dashing out of the door. Attempt to avoid spilling decaf latte on laptop while working on the company’s Annual Report on the train. Get to desk to find a range of issues so encyclopedic that it’s difficult to know where to start – and I thought a two-year-old was demanding!
Such is the life of the chief financial officer in a smaller company and particularly one that’s quoted on a public market. The nature of working in a small management team invariably means that you’re carrying a much broader range of responsibilities than you might be elsewhere. For example, I am tasked with looking after operational aspects of the business such as HR, liaising with our industry regulator, and I also get involved in business development activities, which in a smaller company needs support from all of the senior team.
But for a smaller company that’s listed or quoted on a public market such as those operated by the PLUS Stock Exchange, there are additional burdens that fall primarily on the CFO’s shoulders. Going through the process of an initial public offering might be grueling enough – putting together the documentation, liaising with the advisory team and talking to potential investors – but once you’re on-market, there are a whole new set of priorities to manage.
I can genuinely empathise with any SME CFO facing this challenge, both as one myself but also from the perspective of the PLUS Growth Market – part of the PLUS Stock Exchange, which in turn is part of PLUS Markets Group.
In my view, it’s helpful to consider these new demands in the context of how the public company environment can act as a good discipline on the business, rather than just in terms of compliance. Your ongoing advisory team (the broker, the PR firm etc) might feel like a cost you could do without, but they can bring some valuable insight into how to manage your messages into the marketplace so they resonate both with the investment community and, by extension, potential customers. The financial disclosures that you’re making in conjunction with your auditors involve careful consideration of not just the numbers but also their presentation, so your business is as well understood by the market as possible. And dealing with analysts who are interested in your current and future performance really is a whole new ball-game.
Visibility is key for any company and can really help improve investor interest and liquidity. But many smaller companies simply don’t have the time – or access to resources – to build their profile.
The CFO is also responsible for handling price-sensitive information about the business’s performance. Internally this information must be handled very differently from the way it is dealt with in a private company. While seemingly every member of staff is watching the share price – and discussing it over the coffee machine – you and your finance team come under new restrictions around what they can discuss with their colleagues. This combination both of transparency and secrecy at the same time can offer pitfalls for the unwary – as if you didn’t have enough to worry about already.
Nemone Wynn-Evans is chief financial officer of PLUS Markets Group, a London-based stock exchange and a market operator providing cash trading and listing, derivatives and technology services.
View our archived webinar, including Oracle and a host of ‘Fast Data’ experts, to discover how financial professionals can help create a Fast Data business
Business whose operations span a number of sectors and a broad variety of projects put immense demands on FDs and their supporting finance teams
Christian Doherty looks at the impact Brexit will have on trade relationships and supply chains
Reinmoeller, professor of strategic management at Cranfield School of Management, has proposed an Eight Actions Model to help organisations increase margin and perform ahead of market expectations