According to the U.S. Bureau of Labor Statistics (BLS), business and finance employment will grow 7% through 2032, above the average projected growth for all U.S. occupations. Graduates of Concordia University Chicago’s online MBA with a finance specialization program are equipped with the skills and knowledge to succeed in corporate finance. If you’re interested in this exciting subset of finance, then continue reading to learn more about the importance of corporate finance, the top business decisions it affects and careers in the industry.
What is Corporate Finance and Its Importance?
Investopedia defines corporate finance as, “a subfield of finance that deals with how corporations address funding sources, capital structuring, accounting, and investment decisions.” In other words, it’s the ability to keep your corporation’s finances healthy and growing. This includes day-to-day cash flow and long-term financial planning.
Corporate finance is integral to business success because it allows employees to effectively manage finances, maximize shareholder value, improve business performance, secure capital and mitigate financial risk. Organizations with strong corporate finance leaders making decisions could mean the difference between a thriving company and going bankrupt.
Corporate Finance Business Decisions
CUC’s online MBA in finance program offers the course Intermediate Corporate Finance. In this course, you’ll learn how to make effective corporate finance decisions in the three areas of investing, financing and working capital management.
1. Investing
One aspect of corporate finance is evaluating what companies, projects, or acquisitions a company should invest in. The main tasks for capital investing are completing research on these options and budgeting for planned investments. This includes creating a long-term plan as well as managing and researching short-term investments.
2. Financing
Once corporations choose investments, they’ll need to decide how to fund them. This financing is composed of either equity, debt, or a combination of the two. Corporate finance professionals know how to balance these financial decisions to make the most profitable decisions for the organization.
3. Working Capital Management
Investopedia defines working capital management as, “a business strategy designed to ensure that a company operates efficiently by monitoring and using its current assets and liabilities to their most effective use.” In other words, professionals in charge of working capital management ensure the corporation can pay its short-term debts and short-term operating costs.
Careers in Corporate Finance
Employers in the corporate finance industry vary and include banks, institutions, public accounting firms, corporations, and small businesses. Professionals equipped with corporate finance knowledge and business expertise can choose from the following careers:
Finance Manager
The finance manager is responsible for overseeing the financial health of an organization. The skills required for this role include analyzing financial patterns, attention to detail, communication, and financial software knowledge. Finance managers are typically in charge of creating and managing the internal budget and reporting on these numbers quarterly to senior managers. Indeed states that the average salary for a finance manager is $107,314.
Cost Analyst
If analyzing numbers is your talent, then pursuing a cost analyst role could be for you. Some example responsibilities cost analysts have include:
- Gathering and analyzing financial data to uncover deficiencies
- Examining corporate expenses to report information to managers
- Estimating production costs of a new product or service before it enters the market
The average cost analyst salary is $82,663, however, this salary highly depends on the size and sector of the organization.
Corporate Accountant
A corporate accountant works under the guidance of the Chief Financial Officer in a non-accounting company. They typically work with a team in workplaces such as local businesses, national corporations, or international organizations. Common responsibilities can include maintaining company accounts, preparing financial statements, preparing the budget, communicating with other department leaders, and providing strategic support. The average salary for a corporate accountant is $71,119, according to Indeed.
Chief Financial Officer (CFO)
A certain level of experience and education is needed for professionals to earn the CFO role. According to Investopedia, “The majority of people who end up in this position have advanced degrees and certifications, such as a graduate degree in finance or economics…” The CFO is a member of the most important executives in a company, and due to this fact, they hold many high-level responsibilities.
Examples of CFO responsibilities include working with other senior managers to ensure proper funding of projects, giving input in the company’s investments, and being a strategic partner to the CEO. Indeed reports the average annual CFO salary is $153,288.
If a role in corporate finance sounds interesting to you, then pursuing an online MBA with a finance specialization can help you achieve your career goals quickly. Visit Concordia University Chicago’s online MBA in personal finance program page to learn more about this degree and how it can help you achieve your career goals.