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How CFO Hiring Has Changed

CFO chief financial officer

CFO hiring isn’t what it used to be. That’s according to a recent survey by IMA® (the Institute of Management Accountants) and ACCA (the Association of Chartered Certified Accountants). What’s changed? We highlight the research’s key points about CFO hiring below and ask some of our favorite advisors and recruiters for their thoughts.

The CFO’s Relative Importance

About 82% of CEOs feel that a CFO’s importance is increasing compared to other C-suite executives. “This suggests that the CEO respondents value the CFO role more highly than the incumbents themselves and see it as a fundamental role in the development of the entity,” the study authors state. “It also suggests that what CEOs may expect of their CFOs is increasing, and therefore there is a need for the role to evolve.

Interestingly, only 66% of CFOs themselves felt their roles were increasing in importance. It could be that CFOs already knew how important their roles were? “CEOs often spend their energy looking outside the organization to partners, creditors, shareholders, directors, etc., and can often forget about some of the internal housekeeping required of them,” says The HT Group Executive Advisor Mitch Martin. But, he adds, there could be another reason: “CEOs are not effectively communicating the value of the CFO to the CFO.” 

How Tech Priorities Have Changed CFO Hiring

The biggest challenges newly hired CFOs will need to address are the impact of technology on the business and the speed of business changes. How have these priorities changed the way CFO hiring is conducted?

“Organizations should be asking questions around a CFO candidate’s use of new technology not only for finance but in areas like planning and HRIS,” says Dave Benjamin, Practice Director of The HT Group Professional Services. “Experience overseeing digital transformation or major shifts in product offerings with the aid of technology will be crucial in future CFO hiring for multiple sectors, too.”

Ethics and Trustworthiness

Respondents across the board agree that the “ethical lens” that CFOs apply to their work differentiates them from other executives. “This is especially important in times of rapid change,” the study authors add.

So, how can a CFO’s ethics and trustworthiness be identified during the hiring process? “Ask a CFO candidate about a time when they were asked to do something that was not appropriate. How did they handle it?” Martin recommends. “Any experienced CFO should have plenty of stories,” he adds. You can then compare their response to your organization’s standards and expectations.

Today’s CFOs are Drivers of Innovation

The study authors conclude that, instead of being the one who traditionally pumps the breaks on big decisions due to cost control, CEOs are looking to their CFOs to provide forward insight, essentially becoming chief performance officers. What does that mean?

“The CFO role is clearly moving away from a focus on pure cost control to one that is supporting the wider growth objective,” the authors reflect. “That is not to say that we ignore cost control. It remains an important element, but what is important is the balance between driving effective cost management through a focus on growth and understanding which investments give the greatest return.”

Strict Qualifications Could Be a Mistake

About 81% of CEOs feel that CFOs should have an accountancy qualification or Master’s degree. “Possession of such qualifications was perceived as a given by many of the roundtable participants,” the study authors write. That being said, it’s wise to consider other paths toward the CFO role.

“Certainly having a good accounting understanding and background is a great foundation but a Master’s or a CPA does not alone qualify one for the CFO role,” says CFO Consultant/Career CFO Tom Garrett. Garrett points out treasury, financial planning and analysis (FP&A), operations finance, and mergers and acquisitions (M&A) experience as other career paths and sets of experiences that may qualify an individual for CFO. “Qualifications such as a strong analytical capability and fluency in corporate finance and FP&A may contribute more than a singularly focused strength in accounting. The other disciplines under the umbrella of finance are often geared to be forward-looking while accounting—in its purest form—is primarily backward-looking. A CFO must be able to fluently explain the past (accounting), and working with the senior team, also be able to see, explain, model and help others to see and create the future.”

If you’re a CFO searching for your next big move, check out our job board and submit your information. And if you need guidance around CFO hiring, The HT Group can help. The HT Group Executive Advisor Team can help you determine your needs and strategy, while our award-winning executive recruiters are some of the best in the business when it comes to recruiting top talent.