And What Will: Speaking Finance's Language in the Boardroom

You walk into the quarterly business review with what you think is a winning hand: "Our campaigns delivered 4.2x ROAS this quarter." The CFO nods politely. The CEO moves to the next agenda item. You wonder why nobody seems impressed by numbers you worked so hard to achieve.

Here's the uncomfortable truth: ROAS is a marketing metric, not a business metric. And in the boardroom, only business metrics matter.

This isn't about ROAS being wrong. It's a useful operational metric for optimizing campaigns. But when you're competing for budget against R&D, sales, and operations, you're speaking a language that doesn't translate.

The Translation Problem

When you say "4.2x ROAS," here's what the CFO hears: "Marketing did some math with their own metrics." It doesn't connect to anything they track.

Finance operates in a different universe. They evaluate every investment—whether it's a new factory, an acquisition, or your marketing campaign—using the same framework:

• How much cash does this require upfront?
• How much cash does it generate, and when?
• Does it beat our cost of capital?

ROAS answers none of these questions.

Three Reasons ROAS Falls Flat

1. ROAS Ignores Margin

A 4x ROAS sounds great until you realize your product has a 20% gross margin. You spent $100K on ads to generate $400K in revenue—but only $80K in gross profit. After the ad spend, you're left with... $80K - $100K = negative $20K.

That "4x return" actually lost money.

💡 The Fix: Report Gross Profit ROAS: (Revenue × Gross Margin) / Ad Spend. Or better yet, report contribution margin after ad spend.

2. ROAS Ignores Time Value

Finance knows that a dollar today is worth more than a dollar next year. This is why they use Net Present Value (NPV) to evaluate investments—it discounts future cash flows back to today's value.

ROAS treats all revenue the same whether it arrives in week one or month twelve. A brand campaign that builds equity over two years looks identical to a performance campaign that converts immediately—when in reality, the timing makes them very different investments.

💡 The Fix: Present marketing investments with cash flow timelines. "We'll invest $500K in Q1-Q2, generating $150K in incremental profit in Year 1, $200K in Year 2, and $250K in Year 3."

3. ROAS Doesn't Compare to Alternatives

The CFO's job is capital allocation—deciding where the company's limited resources should go. Every dollar you spend on marketing is a dollar that can't be spent on R&D, sales, debt paydown, or returned to shareholders.

ROAS only compares your campaigns to each other. It doesn't answer the question the CFO is actually asking: "Does this beat our other options?"

💡 The Fix: Know your company's hurdle rate (typically 10-15%). Present your marketing ROI against this benchmark: "This campaign delivers an 18% return, exceeding our 12% hurdle rate."

What Actually Impresses the CFO

Here's the same campaign pitched two ways:

❌ The Marketing Pitch	✓ The Finance Pitch
"We're projecting 4.2x ROAS on this brand campaign, which would be our highest-performing initiative this year."	"This $500K investment generates an estimated NPV of +$92K at our 12% cost of capital. The IRR is 18%, clearing our hurdle rate by 6 points. Even in a downside scenario with 30% lower response rates, NPV remains positive."
CFO thinks: "What does that mean for our business?"	CFO thinks: "This person understands how we evaluate investments."

The second pitch uses the exact same data. It just translates it into the language finance uses for every other investment decision.

The Metrics Finance Actually Uses

Here's a quick primer on the metrics you should know:

Net Present Value (NPV)

The gold standard. NPV calculates the present value of all future cash flows, minus the initial investment. Positive NPV = value creation. Negative NPV = value destruction.

"This campaign has an NPV of +$92K, meaning it creates $92,000 in shareholder value."

Internal Rate of Return (IRR)

The percentage return on your investment. Compare it to the company's hurdle rate to determine if the investment is worthwhile.

"The campaign IRR is 18%, exceeding our 12% hurdle rate."

Hurdle Rate

The minimum acceptable return for an investment. Usually based on the company's cost of capital (WACC). If your investment doesn't clear the hurdle rate, the CFO's job is to reject it.

🎯 Action Item: Find out your company's hurdle rate. Ask your CFO directly—it's a legitimate question that demonstrates financial sophistication.

Return on Invested Capital (ROIC)

The company-wide measure of how well capital is being deployed. Many executives are compensated based on ROIC. When ROIC exceeds cost of capital, the company creates value.

"Our marketing investments contribute to company ROIC of 15%, well above our 10% cost of capital."

The Real Secret: It's Not Just About Numbers

Learning these metrics matters. But the bigger shift is understanding the mindset behind them.

Finance sees every dollar as having an opportunity cost. When you request budget, you're not just asking for money—you're asking the company to forgo other uses of that capital. Your job is to prove that marketing is the best use.

This isn't about abandoning ROAS. Keep using it to optimize campaigns. But when you walk into the boardroom, translate your results into the language of capital allocation.

Because here's what really impresses the CFO: a marketing leader who understands that marketing isn't a cost center asking for budget—it's an investment function competing to deploy capital at returns above the hurdle rate.

That's a CMO who earns a seat at the table.

Quick Reference: What to Say Instead

Instead of...	Say...
"We achieved 4x ROAS"	"We generated $X in incremental gross profit on $Y investment, a Z% return"
"This campaign will increase brand awareness"	"This investment has a positive NPV of $X, generating returns over Y years"
"We need more marketing budget"	"Our current marketing ROIC is 18%, above hurdle rate. Incremental investment should maintain returns."
"Competitors are outspending us"	"Our market position requires X investment to maintain pricing power and protect margin"
"Marketing drove $10M in pipeline"	"Marketing contributed $X to free cash flow this quarter after accounting for CAC and working capital"

This article is part of the "Finance for the Boardroom-Ready CMO" series.

Based on concepts from the CFA Level 1 curriculum, translated for marketing leaders.