Korn Ferry Study: Poor Working Relationship with CEO Top Reason CFOs Would Voluntarily or Involuntarily Leave Company
-- Only 8 Percent Believe Not Meeting Financial Goals Top Reason a CFO Would Be Asked to Leave --
-- Becoming a CFO at a Larger Company Top Choice for Next Career Move --
-- Only 44 Percent Believe There’s a Solid CFO Succession Plan --
“Surprisingly, only 8 percent of respondents said ‘not meeting the
company’s financial goals’ is the top reason a CFO would be removed from
his or her post,” said
Having a strong acumen for broader business issues is a high priority, as the largest percentage of respondents (27 percent) say general management is the most critical experience for CFOs, followed closely by strategy/M&A experience at 26 percent.
Only 2 percent of respondents said risk/compliance experience is the
most critical experience, yet the survey shows that area is where they
are spending a large portion of their time. Of the CFO respondents in
publicly traded companies, nearly one-third (31 percent) say they spend
between 15 percent and 25 percent of their efforts on public company
activities such as
“Many CFOs are spending a disproportionate amount of time on compliance at the expense of broader strategic business issues,” said Proctor. “That’s why it’s critical for the CFO to build a strong, trusted finance team whose members can competently complete tactical work.”
The survey also shows that the needed skill sets of CFOs is expanding, with 89 percent of respondents stating IT literacy is either important or very important to becoming a CFO. However, when asked whom they work most closely with in the C-suite apart from the CEO, only 14 percent say it’s the CIO/CTO.
When it comes to planning for the future, 57 percent of CFOs say it is
likely that their successor will come from within the company. This is
consistent with the rate of internally promoted CFOs previous
“While some companies have a succession plan in place, it’s important for organizations to continually revisit this topic,” said Proctor. “With automation and outsourcing of the function shrinking the overall size of the core finance team, companies need to be vigilant in identifying, developing and supporting the leaders that will drive their future finance strategy.”
When considering what’s next for their careers, a third of the CFOs say their next desired move is to become a CFO of a larger company. Nearly one quarter (23 percent) say they would like to be a CEO in their next role, but only one third either agree or strongly agree that they are a successor to the CEO position in their current company.
When it comes to the skills CFOs admit they are missing to become CEO, commercial experience (24 percent), industry depth (21 percent) and operational experience (20 percent) top the list.
“It’s not surprising we see these skills at the top of the list, since the typical career path for CFOs who become CEOs often takes them into operational experiences,” said Proctor. “Companies would be well suited to ensure CFOs and the finance function as a whole take on general management experiences in order to broaden their operational skills as well as develop their leadership and influencing abilities,” said Proctor.
About the Study
Tracy Kurschner, 612.309.3957