R604015 - rr-0075 - CFO Destination v8

CFO DestinationFortune 100 Edition

R604015 - rr-0075 - CFO Destination v8.indd 1 21/04/2016 19:38:48

2

Contents

Methodology 3

Departure Overview 4

Management Roles 5

Board Roles and Retirement 7

Gender Diversity 8

About Russell Reynolds Associates 9


3

MethodologyIn order to get a 360 degree understanding of today’s Chief Financial Officer, not only do companies, senior executives, and shareholders need to investigate in how these talent get to the top finance seats, but also where they are headed next after serving their tenures.

Russell Reynolds Associates analyzed the backgrounds and career history of 88 Fortune 100 company CFOs who left their posts in the last 10 years. We looked at factors such as reasons of departures, turnover timeline, as well as the roles and functions they have taken over following their departures, aiming to get a sense of the trends and dynamics of exiting CFOs’ career aspirations.

Career experiences were assessed based on thorough reviews of both public and proprietary databases. Insights were generated based on statistic results and trend analysis. The overreaching dataset includes more than 5,000 data points.


4

Departure Overview

New CEO appointments do not always “quickly” lead to CFO departures

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Average age at departure

55

Pre-recession Post-recessionDuring the recession

13

20

1414

10

2

67

67

21

Departure Timeline

46%44%

10%

20%

Majority saw at least one new CEO appointed during their tenure

Most CFOs did not leave immediately a�er a new CEO was appointed

Denominator = Number of CFOs who saw new CEO(s) during their tenure

However, only a-fi�h of that population had outlasted the new CEOs at their respective companies; none outlasted more than one new CEOs.

1 new CEO appointedduring tenure

2 or more new CEOsappointed during tenure

No new CEO appointedduring tenure

65%

Le� within 6 months a�er CEO appointment

Le� 6 months - 1 year a�er CEO appointment

Le� 1-2 years a�erCEO appointment

Le� more than 2 years a�er CEO appointment

4%

19%12%


5

Management Roles

The Majority of the population took on a new management role after they left their CFO posts. Internal hires are more likely to take on another internal role after their departure. External hires tend to have longer CFO tenure

57% 43%

Took internal rolesTook external roles

Average total years with company

53

NEWMANAGEMENT

ROLES

38Internal

when appointed

77% 23%

15.7Average tenure in CFO role

4.9 years

15

External when appointed

65% 35%


6

Management Roles

Denominator = Number of Non-retirees*Less than half (41%) of the CFOs who took external roles have had prior exposure to their immediate next sectors

CFOs who took internal roles predominately moved onto large operating positions. All the CFO-become-CEOs (all men) were appointed in the last three years.

The Majority of CFOs who took external roles moved laterally to another CFO role.

ExecutiveBoard Role

Yet to find new role26%

9%

VP Sales

4%COO4%

Public Sector

4%

VP Strategy

Chief Admin Officer

Chief Legal OfficerRegional GM

Subsidiary CFOVP Marketing

Executive Vice Chairman

BU GM30%

CFO52%

President/CEO

17%

COO14%

10%

10%

7%3%

3%3%3%


7

Board Roles and Retirement

Retired CFOs

NUMBER OF LISTED BOARD ROLES FOR NON-RETIREES

MOST COMMONCOMMITTEES 94%

Audit

38%Nomination/Governance

35%Compensation

57%

13%

On board of anotherlisted company

On board of anotherF100 company

43%

40%

6%

11%

Board Engagement

Average totalyears with company

Averageretirement age

Average tenurein CFO role

CFOs

CFOswere external hires

CFOswere internal hires

3

5

completely retired and have noactive management nor Board role

18

57

7.2


8

Gender Diversity

Despite the small percentage of women CFOs, there has been a significant increase in gender diversity in recent years; nevertheless, we still see high degree of conservatism when hiring female CFOs.

Women CFOs appear to have significantly shorter tenures and time with company They also leave their posts at a younger age.

27 years 21 yearsTotal years spentat company

3 years 7 yearsCFO tenure

80% 38%Fully retireda�er departure

51 48Average ageat appointment

54 55Average ageat departure

80% 67%MBA/GraduateDegree

40% 35%CPA

6%

15%% OF FEMALE CFOs CURRENT FEMALE CFOs

WHO HAD A MALE PREDECESSOR

92%

Previous Current

MAJORITY OFTHEM WERE

SELECTEDINTERNALLY


9

Global offices

americas

ɳ Atlanta ɳ Boston ɳ Buenos Aires ɳ Calgary ɳ Chicago ɳ Dallas ɳ Houston ɳ Los Angeles ɳ Mexico City

ɳ Minneapolis/St. Paul

ɳ Montréal ɳ New York ɳ Palo Alto ɳ San Francisco ɳ São Paulo ɳ Stamford ɳ Toronto ɳ Washington, D.C.

emea

ɳ Amsterdam ɳ Barcelona ɳ Brussels ɳ Copenhagen ɳ Dubai ɳ Frankfurt ɳ Hamburg ɳ Helsinki ɳ Istanbul ɳ London

ɳ Madrid ɳ Milan ɳ Munich ɳ Oslo ɳ Paris ɳ Stockholm ɳ Warsaw ɳ Zürich

asia /Pacific

ɳ Beijing ɳ Hong Kong ɳ Melbourne ɳ Mumbai ɳ New Delhi ɳ Seoul ɳ Shanghai ɳ Singapore ɳ Sydney ɳ Tokyo

© Copyright 2016, Russell Reynolds Associates. All rights reserved.

Russell Reynolds Associates is a global leader in assessment, recruitment and succession planning for boards of directors, chief executive officers and key roles within the C-suite. With more than 370 consultants in 46 offices around the world, we work closely with public, private and nonprofit organizations across all industries and regions. We help our clients build teams of transformational leaders who can meet today’s challenges and anticipate the digital, economic, environmental and political trends that are reshaping the global business environment. Find out more at www.russellreynolds.com. Follow us on Twitter: @RRAonLeadership

About Russell Reynolds Associates


R604015 - rr-0075 - CFO Destination v8

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