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During the first quarter of 2024, 82 Chief Financial Officers of the biggest public companies left their jobs, tying a record set in Q1 2021. The difference between then and now? Many of the CFOs who resigned in 2021 were retiring post-pandemic. Today, many of them are taking over as CEO, COO, or some other C-suite position.
According to data reported by the management consulting firm Russel Reynolds Associates, 271 CFOs left their post as finance chief in 2023. And Russell Reynolds says that 291 new CFOs were appointed in 2023 — nearly two-thirds of them first-time CFOs.
That adds up to a huge demand for new CFOs around the globe.
SEC Filings and Beyond
Historically, the workload of a CFO at a public company was focused on compliance with Securities and Exchange Commission filings, best accounting practices, and financial reporting.
Today, Chief Financial Officers — whether they work at a public company or a private one — need far more than stellar accounting skills.
As U.S. Bank found when it polled CFOs, they “face tremendous economic and geopolitical uncertainty – not to mention new risks caused by advancing technologies. But they can also see huge growth opportunities for their teams and the wider business.”
Key takeaways from the 2,000 CFOs the bank polled show that the financial leaders are:
- struggling to balance the need to cut costs with the need to invest in growth,
- exploring emerging technologies,
- worried less about inflation but more about global risk,
- positioning themselves to balance short-term risk mitigation with long-term growth,
- prioritizing investing in AI to drive risk management and business growth, and
- planning to use ERP systems to move money.
Change is Not New
The role of the CFO has evolved over the last two decades, due to the accelerated pace of the digital age. Today, a CFO must not only understand a business from start to finish to provide financial excellence, but also must predict what is coming from a strategic standpoint and be ready to evolve.
The hardships that came with the 2008 recession pushed CFOs to serve in a more strategic role, one that focuses on people, strategy, and externally focused communication.
As Deborah O’Connor, a veteran CFO who was named Executive Vice President and CFO of ACCO Brands in 2022, said at a pre-pandemic event hosted by the National Association of Corporate Directors: the “CFO of 10 years ago is the Controller of today.”
Great CFOs cross borders as well, whether private, public, private equity-backed, or family-owned. O’Connor said that while you might have different constituencies in each of those types of organizations, the foundation is the same: controls have to be in place, good projections must be forecasted, decisions on prioritization must be made. Most importantly, a CFO bonds very well with the CEO, empowering them to take the charge forward in a positive direction.
How to Find the Right CFO for Your Company
In a perfect world, every organization would have a well-thought-out succession plan that would be activated when a CFO resigns, retires, or is promoted. While it is still far from 100 percent, Russell Reynolds says things are improving. More than half of the new CFOs who took office in 2023 were internal hires — someone who had been groomed to take over the job.
That was much more likely to be the case for public companies whose stock trades on the Nikkei 225 and Hang Seng. For Western public companies, however, the new CFOs were more likely to be external hires with experience in the CFO job.
How an Interim CFO Can Help
A high-quality interim CFO can immediately jump in to provide a fresh outside perspective to assess the organization and team and create a roadmap to keep forward movement. An interim can also identify what is needed in the next full-time CFO, assist with the CFO search or mentor a team member internally to eventually step into the role.
“It’s a calming notion to have someone come in and fill the seat so the seat is not empty for very long. It gives people someone to look up to, to talk to and share their anxieties with,” says Interim CFO Larry Firestone, who has led companies from startup to a $500 million public energy company.
Larry is an experienced Chief Financial Officer on InterimExecs’ RED Team, an elite team of top CFOs and other C-suite leaders who bring a variety of industry experience in growing and turning around companies.
He has seen operations come to a halt when the CFO role goes vacant. “An Interim CFO is a senior executive that has seasoning and talent and experience that the team can relate to,” he says. “They calm everyone down, and it’s really about keeping the company moving and running the way it should.
Most interim appointments last for eight months, though can range anywhere from a few months to several years. CFOs on InterimExecs RED Team are experts at stepping in during periods of transition so will stay on until a new full-time hire is onboarded and ready to take over. In some cases, companies ask our experienced interim execs to stay on the job for a short time to mentor the new hire through those first few months and ensure a smooth handoff.
Which Public Company CFOs Resigned, Retired, or Were Promoted Recently?
Some high-profile CFOs who changed jobs in 2023 and 2024:
Ruth Porat, Alphabet, parent of Google: The company’s longest-serving CFO, she was promoted to the newly created role of president and chief investment officer in September 2023.
Mark Secor, Horizon Bancorp: After spending 16 years as CFO, he now is the chief administration officer responsible for investor relations, legal, benefits administration, and corporate facilities.
And, on a less positive note, Chemours CFO Jonathan Lock resigned from his position at the company effective April 23, 2024. His resignation followed an internal investigation. The global chemicals company found that Lock and two other executives, CEO Mark Newman and Controller and Principal Accounting Officer Camela Wisel, engaged in unethical financial practices aimed at increasing executive compensation, CFO Dive reported.
Also facing an accounting investigation, Vikram Luthar, CFO of grain trader Archer-Daniels-Midland, will leave the company. He was placed on administrative leave after two government investigations forced ADM to revise six years of financial data.
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Is your company in need of new financial expertise? Contact us for a confidential conversation about how a RED Team Interim CFO can meet your needs. Prefer to call us directly? We can be reached by phone or text at +1-847-849-2800.
Read More:
*The Strategic CFO
*The 5 Times Companies Should Choose Interim Management Over a Full-Time Hire