The Changing Role of CFOs in India’s IT Sector
India’s IT industry is witnessing a significant shift in financial leadership, with several major firms appointing new Chief Financial Officers (CFOs) over the past year. At least nine companies have undergone CFO transitions, following a wave of CEO exits in 2023. While some of these changes are due to retirements, others highlight the evolving responsibilities of CFOs in a dynamic business environment.
CFOs Take on a More Strategic Role
Traditionally focused on financial management, CFOs are now playing a key role in business strategy, cost optimization, and decision-making. The increasing emphasis on profitability, cost efficiency, and digital transformation has made the CFO position more crucial than ever.
Industry experts suggest that the role has evolved from a back-office function to a front-office leadership position, requiring CFOs to work closely with CEOs to align financial strategies with business goals. With companies prioritizing cost-cutting and operational efficiency, CFOs are expected to contribute beyond financial compliance and play a more strategic role in shaping business outcomes.
Phil Fersht, CEO of HFS Research, notes that CFOs are now seen as essential figures in investor relations and corporate decision-making. “They are no longer just managing financials; they are actively involved in major strategic decisions and cost-reduction initiatives,” he explains.
Increased Pressure on CFOs Amidst Revenue Stagnation
As IT service providers navigate a slow growth phase, the focus has shifted toward improving margins, securing large cost-reduction deals, and facilitating mergers and acquisitions (M&As).
Pareekh Jain, CEO of EIIRTrend, states, “The CFO role has expanded from compliance to business performance. With revenue stagnation, IT firms are focusing on optimizing costs and exploring M&A opportunities, placing CFOs under greater scrutiny.”
This has also led to a trend where CFOs from Tier-I companies are moving to mid-tier firms that are experiencing higher growth. For instance, former LTIMindtree CFO Vinit Teredesai joined Persistent Systems after his predecessor retired.
Gaurav Vasu, CEO of UnearthInsight, observes that slower-growing IT firms are losing senior executives to mid-tier and global companies that offer more growth opportunities. He explains that a significant portion of CXO compensation is tied to stock price performance, revenue growth, and profitability, making growth-stage firms more attractive to financial leaders.
Legal and Retirement-Driven Transitions
Not all CFO transitions are part of a broader industry trend. Some shifts have been the result of retirements, while others have been linked to legal matters.
For example, Wipro’s former CFO, Jatin Dalal, was involved in a non-compete dispute after joining Cognizant. The matter was settled in July 2025, with Cognizant paying over $500,000 to resolve the lawsuit.
In other cases, CFO changes have been routine transitions. Companies like Accenture, HCLTech, and Persistent Systems have seen leadership changes due to retirements rather than strategic reshuffling.
Shriram Subramanian, MD of InGovern Research Services, believes these are largely one-time changes. “These are established companies with strong internal processes. A CFO transition in such organizations is unlikely to disrupt operations,” he says.
The Future of CFOs in the IT Industry
The role of the CFO is set to become even more integral as businesses navigate economic uncertainties and technological advancements. The demand for finance leaders with expertise in cost optimization, M&As, and digital transformation is expected to grow.
With the evolving nature of business operations, companies will continue to look for CFOs who can drive financial performance while aligning with broader corporate strategies.