As CEO of executive search and talent advisory firm Boyden, Chad Hesters hears a lot about what companies are looking for in a CFO. In particular, he works with many midcap, privately held, family-owned companies. We spoke with him about the trends he’s seeing and the skill sets finance professionals should cultivate if they aspire to CFO roles in companies like these.
This interview has been edited for length and clarity.
What skill sets are midcap companies looking for in their CFOs? What are you seeing on job descriptions?
It used to be CFOs just had to be good at finance and accounting. Then over the past 20 years, they really had to start being good at strategy…Now we’re adding technology…. And, oh, by the way, let’s not forget these people are leaders. So they also have to have leadership skill sets…We just keep adding more variables to the equation. It’s becoming a lot.
What does a leader in this environment need to be able to do? It’s three things. CFOs today, maybe more than ever, have to be collaborative, cross-functionally and even externally. They have to learn how to collaborate more with external vendors and thought leaders, especially around the tech space.
They have to be adaptable. I made a comment the other day in an interview that we’re living in the most dynamic geopolitical, macroeconomic, and technological environment humans have ever seen.
And then finally, they’ve got to be good communicators. The days of the chief accounting officer being able to sit in a silo and make sure the debits and credits work, those days are over…
[What] we’re seeing in a lot of our executive searches, especially for CFOs, is this communication piece…Clients are…putting a higher priority on the ability to manage in a faster-moving world and we see [interview] questions like, “Give us a few examples of where you’ve had to lead in a dynamic environment where communication was the key to success.”
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Are you seeing a preference for CFOs from certain kinds of backgrounds? Are you seeing more of a shift towards MBAs versus CPAs?
I have not seen that shift. By the time somebody is a CFO in a reasonably sized organization of some scale, by the time they’ve reached that level of trust and experience, I’m not sure their graduate-level training is as impactful as their ability to drive results.
We are seeing a very high premium put on cross-finance experience…The reason is—and our clients are telling us this—is the world’s moving so fast that the risk of making a poor leadership decision [comes at a] high price right now…Having cross-function experience inside finance, across as many of the verticals as you can, that’s really helpful to get the job.
Are there ways to take the pressure off the CFO? Are CFOs doing too much?
They do have to be experts in delegation, and team building. You can’t delegate unless you’ve got a good team. Whats probably one of the requirements for a CFO…is this ability to train and retain your team.
Now here’s the upside to this: We’re very likely to have more succession candidates for the CFO role in five years’ time than we did five years ago. A CFO and their management team have to be able to do this hybrid of finance, tech, and strategy, and then they have to work cross-functionally…More CFO candidates are ready to be enterprise-level CFOs because of the amount that’s being put on their plate.