Corporate Finance Career Path
Corporate finance career path are the paths i.e. levels which leads to head of all levels, i.e. chief financial officer who directs and controls all the paths and the various paths are financial planning & analysis which is also known as management accounting which analyses the figures and report, controllership which reports in the books of accounts and ensures accuracy of reports and treasury which is in charge of all cash inflows and outflows.
Companies need funds to thrive in business; looking into every aspect of funds needed by a company is referred to as Corporate Finance. It can be defined primarily as the optimum utilization of the financial resources of the company. It is that area of finance which deals with the arrangement of funds for various projects at minimum possible cost, so as to maintain the capital structure of the company. A corporate finance career is generally stable; the work culture is of a lot of responsibility and accountability since it involves raising capital crucial for the growth and expansion of business in the form of acquisitions, managing cash resources, or charting out the company’s future roadmap by managing cash efficiently.
Professionals in corporate finance deal with lawyers, researchers, finance providers, and other key professionals who are the driving force behind any organization, hence there is a lot of learning opportunity available for a corporate finance professional. Good analytical and problem-solving skills, along with commercial awareness, are the key ingredients companies look for in a candidate planning to make a corporate finance career.
List of Top 9 Corporate Finance Career Paths
- Financial Analyst
- Cost Analyst
- Credit Manager Cash Manager
- Benefits Officer
- Real Estate Officer
- Investor Relations Officer
Let us discuss each of them in detail –
#1 – Financial Analyst
Role of Financial Analyst
- The career of Corporate Finance Financial Analyst can be further classified into capital budgeting, which involves estimation of revenue for the annual budget and monitoring the same from time to time to investigate any deviations.
- It also involves the assessment of capital proposals and decisions regarding buying or leasingLeasingLeasing is an arrangement in which the asset's right is transferred to another person without transferring the ownership. In simple terms, it means giving the asset on hire or rent. The person who gives the asset is “Lessor,” the person who takes the asset on rent is “Lessee.” of particular equipment.
- Financial analysts also differentiate between projects depending upon their profitability.
- Every decision has one or more options, to evaluate which option will be better for the company, in the long run, is taken by a financial analyst for example, whether it is profitable to manufacture a particular product in house or procure it from some other firm depending upon the comparative cost analysis. (have a look at NPV vs. IRRNPV Vs. IRRThe Net Present Value (NPV) method calculates the dollar value of future cash flows which the project will produce during the particular period of time whereas the internal rate of return (IRR) calculates the profitability of the project.)
Salaries of Financial Analyst
The median salary of Financial Analysts is around $56,928 in the United States.
#2 – Cost Analyst
Role of Cost Analyst
- A cost analyst is involved in making decisions regarding the cost of any service or product concerning their pricing.
- He/ She also has the role of identifying any areas which will be helpful in cost reduction of any particular product or service by completely understanding their cost and helping in taking pricing decisions as well.
- Job-order costing, activity-based costing are some of the fields, especially in the manufacturing industry, where a cost analyst’s profile is most suitable.
Cost Analyst Salary
The median salary of Cost Analyst is around $57,946 in the United States.
#3 – Credit Manager
Role of Corporate Finance Credit Manager
- A credit manager, as the name suggests, is involved in the credit decisions of the company, how much credit is to be given to the suppliers, the rate, credit guidelines, collection of receivables, and their securitization are all decisions taken by a credit manager.
- This profile requires in-depth financial statement analysis and complete knowledge of the customer profile so as to make strong decisions.
Credit Manager Salary
The median salary of the Credit Manager is around $61,810 in the United States.
#4 – Cash Manager
Role of Corporate Finance Cash Manager
- The cash manager manages all the short-term as well as long-term cash requirements of a company.
- It involves maintaining a healthy relationship with banks for short-term credit needs, safeguarding the company’s interest by having adequate working capitalWorking CapitalWorking capital is the amount available to a company for day-to-day expenses. It's a measure of a company's liquidity, efficiency, and financial health, and it's calculated using a simple formula: "current assets (accounts receivables, cash, inventories of unfinished goods and raw materials) MINUS current liabilities (accounts payable, debt due in one year)", and investing the surplus cash in such avenues that can give sufficient interest.
- It also requires managing international fund transfers. Hence it is a meticulous job and requires you to have excellent negotiation skills.
Cash Manager Salary
The median salary of Cash Manager is around $61,984 in the United States.
#5 – Benefits Officer
Role of Benefits Officer
- The job of a benefits officer is that of an intersection between finance and human resource.
- It involves managing pension funds and other health care benefits and plans which are cost-effective and, at the same time, are for the benefit of the employee.
- Knowledge of organizational behavior, along with human resources and finance, is an added advantage for a candidate planning for this role.
Benefits Office Salary
The median salary of Benefits officers is around $46,722 in the United States.
#6 – Real Estate Officer
Role of Real Estate Officer
- Real estate officer, as the name suggests, has to deal with the real estate issues of a company, be it purchasing a piece of land, negotiating lease terms and conditions with the opposite party, acquiring real estate properties, and evaluating them.
- It requires thorough commercial knowledge of real estate along with finance.
Real Estate Officer Salary
The median salary of Real Estate Officer is around $56,344 in the United States.
#7 – Investor Relations Officer
Role of Investor Relations Officer
- The investor relations officer is responsible for maintaining good relations with a company’s investors, be it individual or institutional investorsInstitutional InvestorsInstitutional investors are entities that pool money from a variety of investors and individuals to create a large sum that is then handed to investment managers who invest it in a variety of assets, shares, and securities. Banks, NBFCs, mutual funds, pension funds, and hedge funds are all examples..
- This job role comes into the ambit of PR and advertising since it involves maintaining good relations with the top executives, replying to institutional investor queries, organizing investor teleconferences, issuing a press release for corporate events, and circulating financial information about the companyFinancial Information About The CompanyFinancial Information refers to the summarized data of monetary transactions that is helpful to investors in understanding company’s profitability, their assets, and growth prospects. Financial Data about individuals like past Months Bank Statement, Tax return receipts helps banks to understand customer’s credit quality, repayment capacity etc. value for the investing public.
Investor Relation Officer Salary
The median salary of an Investor Relations Officer is around $86,770 in the United States.
#8 – Treasurer
Role of Treasurer
Treasury Management is an all-encompassing function of any company; it gives a holistic view of all the duties and functions performed by the other departments by keeping a check on their activities. A treasurer’s job role involves supervising the treasury department, which is involved in the following processes.
- Financing involves analyzing the funding needs of a company and arranging for the requisite capital either through the bank for short-term funding internal or external sources that involve equity, debt, bonds, commercial papers, et al.
- Cash Management involves sorting out the company’s working capital requirement or daily cash needs by negotiating with the banks for favorable credit terms and keeping enough cash for it along with parking the surplus cash in short-term investment options.
- Risk Management involves managing the risk of each and every aspect of running a company, be it through investing in insurance policies or currency hedges for the company’s assets or safeguarding the company’s foreign currency and commodity exposure by regularly checking it.
- Pensions Management involves managing a company’s pension fund pool, investing the funds in the right avenues, managing a particular employee’s payment schedule after duly considering the pension payment periodicity. It basically involves making decisions regarding every aspect of smooth pension fund investment and disbursement.
The median salary of Treasurer is around $87,435 in the United States.
#9 – Controller
Role of Controller
- This is a managerial position that involves duties pertaining to financial planningFinancial PlanningFinancial planning is a structured approach to understanding your current and future financial goals and then taking the necessary measures to accomplish them. Because this does not begin and end in a specific time frame, it is referred to as an ongoing process., accounting, reporting, and cost analysis.
- It also requires financial re-engineering and transfers pricingTransfers PricingTransfer pricing is determined for the transactions between two or more related entities within a multi-company organization. It shows the value of transfer between the associated entities in terms of goods or transfer of employees, labours across different departments. knowledge along with developing forecasting models for the projection of revenues and costs.
- The work arena involves property, revenue, benefits, derivatives, lease, and joint venture accounting of a company.
- The controller is an experienced professional who is called upon to sort out complex costing issues and even be the company’s representative in front of the auditorsAuditorsAn auditor is a professional appointed by an enterprise for an independent analysis of their accounting records and financial statements. An auditor issues a report about the accuracy and reliability of financial statements based on the country's local operating laws..
The median salary of the Controller is around $76,344 in the United States.
Corporate Finance Organization Structure
Let’s understand in detail the areas where you can fit into the structure of corporate finance in an organization. Like any other industry, the corporate ladder has entry, mid and senior-level positions.
Entry Level Corporate Finance Career
- At the entry-level, a bachelor’s degree in finance or economics is needed.
- Practical knowledge of MS office, along with good communication and analytical skills, will give you an edge amongst other candidates.
- The entry-level positions generally include Financial Analyst, Cost Analyst, Business Analyst, Support Analyst, and reporting.
Mid-Level Corporate Finance Career
- A mid-level professional can be employed in the capacity of a Cash Manager, Strategic Planner, Sr. Financial Analyst, Budgeting, and M&A professionals.
- Hence a degree in Masters in Business Administration or a Chartered Accountant has sought after.
- If you have good analytical skills, the ability to pay attention to detail and make quick and informed decisions when needed, then you stand a fair chance at a mid-level position in corporate finance.
Senior Level Corporate Finance Career
- As and when you grow in the organization, with further experience, you will be exposed to more challenging situations, which would help in developing strong management skills and a solid understanding of macroeconomic factors accompanied by persuasive communication skills along with excellent leadership skills where you won’t waver in taking bold financial decisions involving large sums of money.
- Such capabilities represent the senior-level managers who are at the top of the hierarchy in corporate finance; the positions include the Chief Financial Officer(CFO), Chief Executive Officer(CEO), Treasurer, Controller, Special Project, and Business Development Managers.
Skillset for Careers in Corporate finance
The corporate finance setup requires an individual to have an analytical mind with the ability to think on his toes and make decisions based on careful analysis and research. The skillset needed for a corporate finance career include the following
- Problem-solving ability
- Leadership skills
- Communication skills and persuasion ability
- Interpersonal and Intrapersonal skills
- Team cohesion and management
- Commercial Awareness
- Research-based thinking
- Understands what is Financial modelingWhat Is Financial ModelingFinancial modeling refers to the use of excel-based models to reflect a company's projected financial performance. Such models represent the financial situation by taking into account risks and future assumptions, which are critical for making significant decisions in the future, such as raising capital or valuing a business, and interpreting their impact.
- Networking ability
- Comfortable with ambiguities and constantly changing scenarios
Do you like taking challenges head-on? Then a career in corporate finance is the place for you. Studies conducted by Robert Half and Arthur Anderson suggest that there is a steady demand for finance professionals across the world. CEOs across the world were polled by CFO magazine regarding the qualities they seek in finance professionals, and they unanimously stated that “Strategic thinking, fresh perspective, and candor” are the most sought after qualities accompanied by excellent interpersonal and communication skills because it is a team effort after all.
Corporate finance professionals don’t have any targets to pursue like their marketing counterparts, but their job is a lot more exciting and challenging because the employees have to make decisions regarding the long term benefit of the organization rather than achieving short-term goals. Undoubtedly, corporate finance careers jobs are the most sought after and desired in the entire financial industry worldwide.
Corporate finance career paths video
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