CFOs are often overlooked for the chief executive role. An analysis of the FTSE 150 shows that only 17 current CEOs previously held a senior finance/CFO role in their careers, and only 12 of these CEOs were promoted directly from a CFO role. To find out how CFOs could better prepare themselves for the top job, we gathered public and private company financial officers in London, including a CFO-turned-CEO-turned Chairman who had overseen such successions as a guest speaker. Below are the top 10 takeaways.
- Chart your internal progression
When the CFO does become the CEO, it’s most often an internal promotion—our analysis shows nearly 90 percent of CFOs were named CEO within the same company. If you are a CFO wanting to be CEO and considering a move to another company, choose carefully and weigh the pros and cons of staying the course in your current CFO role.
- Develop your skills as a leader
The CEO is a leader of leaders rather than a coordinator of functional experts. Ensure that your direct reports as CFO are of this calibre so that you can practice and develop this skill.
- Plan your own succession
Make it easier for the Nominating Committee to release you from the CFO role by ensuring you have strong successor(s) within your own team.
- Increase your span of control
The best way to show that you have the bandwidth to become CEO is to start to demonstrate this as CFO. Aim to add additional developmental areas to your scope of responsibility.
- Practice humility
The CEO does not have to be the smartest person in the room or know all of the answers. A survey of 2,500 women and men at various levels of leadership across seven countries pointed to humility as one of the top three traits desired in leaders. Work to develop this mindset as CFO.
- Sell the vision
Take opportunities as CFO to sell the vision of the organization both internally and externally, and talk about your own personal values as preparation for doing this as CEO.
Test and retest your own motivation to become CEO. Why do you want it? How does being CEO match your own sense of purpose?
- Get out of the CEO’s shadow
The board wants to see you as CFO making contributions in the boardroom to reassure them that you could do this as CEO. This requires careful coordination with the CEO.
- Challenge the CFO stereotype
Be aware that there is a broad perception that the CFO is often a brake to the CEO’s accelerator. Be prepared to challenge this opinion and show that you have both archetypes within you.
- Perform well
Boards are much more likely to promote a well performing CFO, so don’t neglect your day job.