Compliance used to be a conversation between legal and IT. Today, we’re seeing this change to sit squarely within the CFO’s responsibilities.
With growing regulatory demands, increased board scrutiny, and public accountability around cyber and data risks, financial leaders are expected to understand how compliance failures impact financial performance, expose the business to legal action, and affect long-term value.
The risks are significant, and the consequences are increasingly difficult to ignore. Technology now underpins financial systems, reporting processes, customer data management, and operational continuity. This means compliance failures in IT do more than disrupt systems. They create financial and legal exposure that falls under the CFO’s remit.
Regulators expect businesses to manage data risk with the same discipline applied to financial risk. Failing to do so can result in substantial fines, legal challenges, and reputational damage. In some cases, CFOs may be personally accountable if the business misrepresents its risk position or fails to disclose a material incident. It’s not about knowing every technical control. It’s about understanding what needs to be in place, what happens if it isn’t, and where the financial responsibility ultimately sits.
Overlooked Risks and Financial Exposure
IT compliance touches privacy, data protection, cyber risk, and disclosure obligations. The greatest financial exposure often comes from the less obvious areas of oversight. A business relying on third-party tools that do not meet security standards could be in breach of client contracts or privacy laws. If a system fails and a breach is not reported in time, the business could face audit failures and legal action. If a claim is filed with an insurer but key controls were never implemented, the policy may not respond, leaving the full cost of recovery with the business.
CFOs also need to consider their role in financial disclosures. If cyber risk is considered material to the business, it must be accurately represented in board reporting, investor statements, and financial documents. Inaccuracies or omissions here are not just operational risks. They can trigger significant reputational fallout or formal legal consequences.
Taking a proactive role
CFOs are not expected to manage technical systems, but they do need to ensure that governance is in place and working as intended.
Start by gaining visibility. Know which frameworks apply to your business and understand how compliance is being tracked, reviewed, and reported. Work with IT and legal leaders to get a clear view of your current posture and any areas of concern.
Build compliance into operational planning and budgeting. That includes investment in training, monitoring tools, third-party assessments, and incident response preparation. Prioritise initiatives that reduce exposure and support regulatory alignment.
Ensure all documents reflect the reality of your environment. This includes board papers, financial disclosures, contracts, and insurance policies. Contracts with technology providers should clearly define their compliance responsibilities, and policies should be reviewed against your actual security practices.
Above all, keep the board informed. Cyber and IT compliance are governance issues, and CFOs have a key role in helping leadership understand the financial implications of risk.
From protection to value
Compliance is often seen as a cost, but it is also a form of protection. When businesses are confident in their controls, systems, and disclosures, they are more resilient, more agile, and better prepared for scrutiny.
Strong compliance processes can prevent disruption, safeguard insurance coverage, and reduce the likelihood of fines or investigations. They also strengthen trust with customers, regulators, and investors. CFOs who step up in this space are not just protecting the business. They are leading it forward.
IT compliance failures may not start in finance, but the consequences usually end there. By taking a leadership role, CFOs can ensure their organisations remain not only compliant, but protected and prepared for what lies ahead.
