Posted By: Kaplan Schweser
Published: June 29, 2020
The CFA® charter can be useful in a corporate finance career. Corporate finance includes implementing various strategies for corporate investment and increasing shareholder value. The CFA exam covers some corporate finance topics, such as portfolio management, working capital management, and more. This article explores the corporate finance roles for which earning the CFA charter is a good idea.
Research analysts play an important and specific role in corporate finance, using a combination of mathematical processes and qualitative data to look for trends and patterns that can inform corporate investment and financial planning. They are able to process data and provide recommendations. The intelligence they gather is incredibly valuable to corporations, and 15 percent of CFA charterholders are research analysts. Many of them are in a corporate finance role.
Corporate financial analysts use historic and qualitative data, microeconomics, and macroeconomics to uncover trends and patterns that enable them to make predictions and forecasts. In corporate finance, these analysts conduct research, provide advice, and are relied on as critical advisors in the process of making investment decisions. According to CFA Institute, 5 percent of those who hold the CFA charter have a corporate financial analysis role.
Equity analysts research and report how strong companies are in the securities market. Their focus is on stocks. The equity analysts who work in corporate finance research companies in their employers’ portfolios. Some equity analysts prepare reports that offer buy and sell recommendations to management. We were not able to find statistics for what percentage of CFA charterholders are equity analysts, but it is a valuable designation in this field.
Portfolio managers in corporate finance are in charge of their company’s fund or group of funds. They spend their days working with analysts and researchers to stay current on the markets and business news that might affect their funds. They make decisions to buy and sell assets as the markets fluctuate. They look beyond surface information and make decisions for their companies based on expert insight and experience. CFA Institute reports that 22 percent of CFA charterholders are employed as portfolio managers. It is likely that part of that percentage of charterholders is in corporate finance.
CFOs are the head of corporate finance. Holding the CFA charter does not guarantee you’ll make it to the C-suite in corporate finance. CFA Institute says that approximately 7 percent of all the CFA charterholders are chief-level executives, but they do not specifically state whether they are CFOs, CEOs, CIOs, and so on. However, CFO positions are considered the pinnacle of finance achievement, so CFOs probably make up a great deal of that percentage.
In addition, if the CFO or someone in a senior corporate finance role is a CFA charterholder, holding the charter can be a big plus for you. If those with the responsibility of hiring or choosing analysts and managers in corporate finance hold the charter, they tend to look favorably on candidates or entry-level roles who have also earned it.