Finance forte. The future of finance leadership At a glance

Transcription

1 Finance forte The future of finance leadership 2011 At a glance

2 What is Finance forte? Finance forte: the future of finance leadership provides insight into the future requirements of the Group CFO role and what current CFOs, aspiring CFOs and boards need to do to keep up. In it we cover: Nine key steps for aspiring Group CFOs Talent development as a measure of individual CFO performance The risk to boards of not investing in the pipeline of finance talent The career paths of the top 100 CFOs within Europe, the Middle East, India and Africa (EMEIA) 66% of respondents believe the title CFO is inadequate

3 Nine steps that aspiring Group CFOs need to prepare for the role Findings from our study suggest there are nine important steps that aspiring Group CFOs can take to ensure they are well prepared to meet the future challenges of the role: 1. Gain a breadth of finance experience 2. Develop commercial insight 3. Seek out M&A experience 4. Obtain a balance of traditional and non-traditional skills 5. Develop leadership and team-building skills 6. Get international exposure, particularly in emerging markets 7. Gain experience of finance transformation initiatives 8. Get exposure to the market and its stakeholders 9. Build effective relationships with the board The study is based on a survey of over 530 Group CFOs and their direct reports across EMEIA, conducted with the Economist Intelligence Unit, as well as in-depth interviews with leading CFOs and future finance leaders, including those from: Financial Times Group Friends Provident Larsen & Toubro Ltd Novartis Pernod-Ricard Reed Elsevier Telefónica UBS UK Home Office Unilever

4 The career paths of the EMEIA top 100 The study includes analysis of the career paths of the top 100 EME Where did they come from? From within the same company 57% Group CFO From a different company 43% Head of operations-orientated divisions (e.g., corporate strategy, corporate governance) 26% Head of other finance-oriented divisions 24% CFO at a different company 13% CFO of a smaller division/ regional division at same or another company 12% Vice President/Managing Director/Management Board Member/Deputy CEO 10% CEO/Chairman/Partner 8% Deputy CFO at same/ another company 6% CEOs of other divisions 1% Role before moving to the Group CFO position. Two-thirds of CFOs believe candidates experience are less likely to get the to

5 IA company Group CFOs within the Fortune 500. How did they get there? Group CFO Stepping stone to Group CFO position Hired from within 57% External hire 43% Sector movement International experience First job Non-finance role 37% Same sector 30% Held positions in one country 52% Changed sector 70% Held positions in more than one country 48% Finance role 63% Education MBA 34% Accountant 22% MBA and Accountant 3% PhD 15% Other 26% The most popular route to the Group CFO position at EMEIA companies in the Fortune 500 is highlighted in bold above. without direct commercial p job

6 73% of CFOs believe that very few people in their organization have the broad skills required to be Group CFO Percentage of respondents who either strongly agree or agree with these statements Very few people in our current finance organization have the broad skills required to succeed as a Group CFO The strategic responsibilities and higher profile of the CFO role has made it a more attractive career aspiration The title CFO doesn t convey the full range of a CFO s role and responsibilities today The breadth of skills that are necessary to be a successful CFO means that the pool of good candidates is becoming smaller My organization creates opportunities for junior finance talent to gain broad commercial skills Strongly agree Agree

7 The Master CFO Series The Master CFO Series Volume 2 Our CFO program This is one of a series of studies from our CFO program, which we hope brings something different to the CFO of today and tomorrow. The program seeks to provide insight and guidance on aspects of personal interest to the CFO as they seek to develop themselves, their teams, and learn from others within their community. Other publications from the program include: The DNA of the CFO A study of what makes a chief financial officer Finance forte The future of finance leadership The Master CFO Series A collection of studies on particular events and experiences that CFOs encounter as part of their role. (Vol. 1) Back seat or center stage? CFOs and the media (Vol. 2) What lies beneath? The hidden costs of entering rapid-growth markets More information To request a copy of any of these studies, or for further information on our program of investment in CFOs across EMEIA, please go to or contact your local EY representative.

8 EY Assurance Tax Transactions Advisory About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com EYGM Limited. All Rights Reserved. EYG No. AU1011 EMEIA Marketing Agency ED None In line with EY s commitment to minimize its impact on the environment, this document has been printed on paper with a high recycled content. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice. ey.com The views of third parties set out in this publication are not necessarily the views of the global EY organization or its member firms. Moreover, they should be seen in the context of the time they were made.