Due to the unique challenges that the year 2020 brought, 2021 saw a revolution in the roles of C-suite leaders, including that of the CFO. For an executive role mostly distinguished by its technical and financial requirements, expectations for the position deepened and expanded as organizations looked to their leaders during trying times.
Our top five CFO articles for 2021 reflect the changing nature of this position and how our CEO and board-level readers pivoted to adapt their hiring requirements accordingly.
Additionally, these articles indicate the increasing requirement for critical soft skills in CFO candidates, such as communication, top-down ownership, and lock-step collaboration with other major players within the C-suite. Here’s a review of our most widely-read CFO articles in 2021.
Our top read article mirrors the evolving discussion about the CFO role in companies and large organizations. While CEOs and board members believe that their CFOs will become more valuable for their companies, one in three feel that their current CFO is ill-equipped for the changing role.
The reason for this? An unpredictable and demanding business environment requires more than risk-aversion and financial parsimony. In 2021, CFOs are now active partners in day-to-day operations management, taking an interest in long-term strategic policy, and getting involved in more public-facing roles. Rapid changes in market scope, consumer demands, regulatory policies, and the nature of business risks has created a volatile environment that only flexible candidates can thrive in, leading to a demand for what KPMG calls “the Renaissance CFO.”
Mere proficiency in accounting and financial dexterity are no longer an indicator of top candidates. In fact, expertise with ERP and financial planning systems is now par for the course. Instead, the modern CFO is expected to be equipped with a broader tapestry of soft and hard skills, including the ability to help foster cohesive company management and champion organizational goals with innate creativity and technological prowess.
For more insights on the character traits and technical capabilities of a CFO equipped to deal with these unpredictable times, read our article on the modern Chief Financial Officer.
While leading a private equity (PE) firm’s financials is an exciting assignment for CFO candidates, data suggests the position suffers high turnover due to a gap in value creation. Simply put, CFOs are not holding on to their PE firm roles because they often do not meet expectations or understand their role in driving value.
As all top level recruiters know, C-suite candidates must not only possess technical expertise but must also demonstrate specific experience within the hiring company’s sector. For a PE firm, which must typically advise and nurture its portfolio companies in addition to caring for its own financials, the ideal CFO hire must understand the peculiar nuances of this position and what value creation looks like in this sector.
Cowen Partners consultants discuss tips to help CFOs thrive in this demanding environment and offer observations on pitfalls that successful candidates might avoid. A mismatch in expectations is often the origin point for a troubled tenure in this position, which is why our first piece of insight recommends finding symmetry with board and CEO demands as the candidate moves into the role.
The article also addresses the multifunctional role that a PE CFO will often play within the firm and why flexibility will be a valuable trait in outstanding hires. Read the full article here for more insights on what PE firms expect from superstar CFO talent.
One of the most challenging aspects of CFO recruitment is identifying the optimal skillset that fits best with an organization’s goals for the position and strategic objectives for the future. To assist CFO search committees and CEOs unpack what they require in the ideal candidate, Cowen Partners consultants share four types of CFO profiles and how each work within a company.
While these profiles are not water-tight or exhaustive, they provide a valuable starting point for grasping the typology of a candidate’s psyche and how this translates with the company’s vision for the role. Our consultants identify and discuss the following four profiles:
Access the article here to learn more about these CFO profiles and the questions stakeholders should ask as they determine which of these candidate types best fits their vision for the CFO role within the company.
Although the ideal CFO candidate pool has grown tighter recently, an explosion in biotech firms is further squeezing access to a limited pool of candidates. As Cowen Partners consultants find in this article, biotech firms are getting more and larger, and this is sparking a tighter race for an already finite pool of top talent. Considering the dearth of suitable candidates, our consultants identify non-traditional routes to CFO talent acquisition that biotech firms may pursue.
A promising possibility explored in this article is the potential that first-time biotech CFOs may pose. While it sounds incredible that an inexperienced candidate may thrive in this position, considering the mix of technical and sector-specific capabilities required for success, there’s a credible case for hiring a first-timer. The hiring route is also backed by data, which shows that a majority of public biotech company CFOs were new to the position when they first entered the organization.
That said, the article also points out that innovative biotech companies might consider a mix of these hiring routes – for instance, a fledgling company can employ a fractional CFO during their early years and then transition to other routes as they grow within the industry.
Read more here about potential strategies that biotech firms may pursue as they look to fill their CFO position.
PEs often exist in boiler room conditions. The pressure for results is intense and shareholders typically expect lucrative net returns on investment regardless of the state of the market. As a result, the demanding environment can often strain capacities, and in the worst case may pitch executives against one another. Collaboration and a sense of ownership are critical to avoid complexities like this, and this article discusses how the COO and CFO positions can be key to harmonious executive performance.
As internally-visible and centrally-relevant C-level members, the COO and CFO help make the firm tick. While the COO takes charge of day-to-day operations, the CFO ensures that they have the resources they need and that someone is watching their back to avoid budgeting and reporting pitfalls.
Working together, both positions help reinforce each other, leading to more efficient and financially prudent operations. Read more on the dynamics of an effective COO-CFO partnership in our article here.
Our hands-on CFO executive recruiters have experience working with private, public, pre-IPO, and non-profit organizations. Clients are typically $50 million in revenue to Fortune 1000’s or have assets between $500 million to $15 billion.
Cowen Partners is the nation’s leading CFO search firm, driven to create value for our clients. Read more of our industry-leading retained search resources to see why Cowen Partners is a top CFO search firm, including tax and accounting leadership, in New York City, Chicago, Seattle, Atlanta, Dallas, Los Angeles, and beyond: