In this blog, we discuss the five essential attributes of great law firm CFOs, featuring insights from Tim McKey, CEO of  Vista Consulting, who authored this article.

The success of any business relies heavily on the effectiveness of its Chief Financial Officer (CFO). This is especially true in highly specialized industries, such as legal services. A great CFO at a contingency fee law firm can be the difference between success and failure. A CFO’s role is to ensure the financial integrity of the firm, but their responsibilities go far beyond just managing finances.

So what makes a great CFO? There are five essential attributes of such CFOs that can lead to success for contingency fee law firms.

They are translators

CFOs are translators of complex financial data and information, taking the numbers and transforming them into understandable visuals that all stakeholders can understand. They are adept at simplifying financial concepts and theories, breaking them down into accessible language so that decision-makers can make informed decisions.

They are analysts

CFOs are experts when it comes to crunching numbers and analyzing data. They review financial records, such as budgets, reports, balance sheets, and income statements, to determine the financial health of the firm. They look for trends that may indicate areas where performance can be improved or potential risks that should be addressed. They examine industry and firm trends and then make suggestions regarding cost-saving opportunities, investment decisions, and new strategies.

They are relationship builders

Great contingency law firm CFOs develop and maintain relationships with vendors, clients, and other stakeholders to ensure their firm continues to have strong financial performance. CFOs understand the importance of communication and strive to build trust between all parties involved. They prioritize building relationships with vendors, especially their firm’s financial institution(s).

They are proactive

CFOs understand the importance of being proactive and strive to stay ahead of any potential risks or issues. They forecast future trends, develop strategies to address looming financial issues, and make data-driven decisions to ensure their firm is on the right track. They provide unsolicited reports to stakeholders and the firm’s financial institution(s). They answer questions before they are asked. They are constantly assessing the current financial situation, looking for opportunities to save costs.

They are leaders

CFOs of a personal injury law firm must not only use their leadership skills to maximize the financial performance of their firm, but they also must have the ability to train and lead their teams to work seamlessly with law firm ops. CFOs of a personal injury law firm must possess strong leadership skills to effectively train and lead their teams. They must be able to provide guidance, motivation, and structure to ensure team members are working in harmony with the firm’s operational objectives. A successful CFO will have the ability to understand the complex relationship between money and operations.

The role of a Chief Financial Officer (CFO) is one that requires a unique combination of strategic thinking ability, excellent communication skills, and strong business acumen in order for it to be successful within any organization – especially those within specialized industries like law firms operating under contingency fee structures. Having an effective CFO can mean the difference between success and failure for any firm; however by understanding these three critical attributes you can ensure your CFO is equipped with all that they need in order to make sound decisions that will benefit your firm long term. A successful CFO will have an understanding of how money impacts operations and be able to effectively use their knowledge to lead their teams toward success. With these qualities firmly established within your organization’s financial department, you can rest assured that your business is on track for long-term growth and stability.

Want to Learn More About Law Firm CFOs?

For more insights about law firm CFOs, watch this video, featuring Tim McKey, CEO of Vista Consulting, as he discusses the importance of CFOs to contingency fee law firms.

For more on Esquire Bank’s expertise in providing tailored solutions for law firms, please visit Esquire Bank’s resources portal, Lawyer IQ, where you can learn about growing your business, financing for law firms, marketing strategy best practices, and more.