The role of CFO in Maltese SMEs : a qualitative study

Abstract

Purpose: This study sets out to analyse the evolving role of CFOs within Maltese SMEs while assessing how this role has adapted to address the key challenges faced by SMEs due to their size. Moreover, this study identifies the essential characteristics required for CFOs in SMEs to succeed. Design: The objectives of this study were attained through analysing foreign and local literature and by undertaking a qualitative approach consisting of thirteen semi-structured interviews with CFOs of Maltese SMEs. Findings: The role of the CFO is evolving from analysing historical financial data to focusing more on strategy. This research outlines the fundamental components of the CFO’s role. When working in an SME, CFOs role. When working in an SME, CFOs must navigate financial constraints by managing cash flows and building relationships with providers of finance. Additionally, leveraging digitalisation is essential to overcome these limitations. Key characteristics identified include advanced technical accounting and technological skills, effective leadership, adaptability and commitment to continuous improvement. Conclusions: This study concludes that the role of the CFO is evolving from a traditional data analyst to a strategic business partner. This transformation increased the complexity of this role, especially in SMEs, where CFOs must navigate their unique challenges. While financial stewardship remains central, modern CFOs are actively involved in decision-making, digital transformation and value creation. CFOs must develop their soft skills to succeed. Given SMEs’ importance in the Maltese economy, CFOs must ensure they possess the necessary skills to establish robust financial foundations for SMEs to grow. Value: This study aims to increase awareness about the importance of CFOs in Maltese SMEs, particularly in addressing their inherent challenges. It examines the core functions of CFOs in SMEs, highlighting the shifting expectations and the characteristics required for success. Finally, it offers recommendations on how CFOs should adapt to the shifting environment to deliver greater value to SMEs.