CFO Network | Taking the Leap: Journey to CEO
In recent years, we’ve seen an increase in CFO recruitment to CEO roles, and that’s good news for ambitious CFOs! At our recent CFO Network event, we invited CFO Programme alumnus, Chris Hill, CEO of Hargreaves Lansdown plc, and Suzzane Wood, Partner & European Board practice at Russell Reynolds to discuss the career journey from CFO to CEO, and provide insights into the skills required to take this leap. The discussion was chaired by Sabine Benz, Director of Deloitte’s Senior Boardroom Relationship Programmes.
To set the scene, there is a growing trend for new CEO appointments to be internal candidates and 25% come from a CFO background – FTSE 350 sitting executive CFOs have on average 2 board roles (including their executive board role) which provides valuable experience for this transition. Research by Russell Reynolds indicates a continued dominance of internal candidates for the CEO role; in the UK, 69% of CEOs are internal appointments. However the number of external appointments is increasing.
Trigger points for the transition from CFO to CEO role
Suzzane explained there are three key trigger points for the CFO to CEO transition. Firstly, having worked 30 years and achieved CFO career milestones, CFOs often turn their thoughts to what is next? Next, having bedded in a third CEO can prompt the realisation that he or she is ready to assume the mantle and finally, having hit the eighth year in a high pressure CFO role in the same organisation, the realisation they have the knowledge and skills to make the transition.
The role of the CEO is unique
Chris shared his personal journey to CEO and key elements which make the role unique. For Chris, when you are the CEO, you are the face of the organisation, and you need to lead from the front and be its biggest supporter and cheerleader. He adds, “It’s personal. When you are a CEO you are personally connected to that business.” As a CEO, you need to be an innovative thinker, it’s a transition from being the person answering questions, to being the person asking the questions. Whilst CFOs will examine the facts and what is there, CEOs need to examine what is not there, and then make a plan for this. A key skill required of the CEO is the ability to shift the emphasis from finance, to focusing on people. In Chris’ experience, CEOs tend to be more extroverted than CFOs, the CEO role centres more around developing impact and galvanising people. Research by Russell Reynolds, shows the distinctive characteristics of CEOs and how aspiring CFOs must move beyond their technical skills and develop more competencies in people. The role of the CEO is complex, challenging and stimulating, so to be emotionally resilient to deal with the physical and emotional demands of the role is essential.
Preparing for the top job
Begin preparing, it’s important to understand your goal and to start developing your leadership skills. In Chris’ case, he spent time with Strategy and Operations, rather than just the Finance team. You need a coach he expresses. “With the right questions from your coach, and a clear understanding of why you want to be a CEO, focusing on emotional intelligence and self-awareness can prepare you for success.” It’s important to also examine how you learn, CEOs need to ask questions, this should be a key part of your outlook and preparation. Indeed preparation is critical, it’s about putting yourself in the shoes of a CEO and experiencing what it is like to be the ‘centre of attention.’ On a final note, “If you want to become a CEO, don’t leave it too late!”
- There is a growing trend for new CEO appointments to be internal candidates – most UK plc CFOs sit on the board, which is valuable experience, in particular where the CFO has held another CFO role previously and so has breadth and depth of experience.
- As the ultimate leader of the business, the skills required for the CEO are unique. Be an innovative thinker, ask many questions, look for the gaps and focus on people.
- To set yourself up for success, preparation is critical. Begin developing your leadership skills, participate in a Transition Lab, get a coach, become self-aware, experience being the ‘centre of attention’ and “don’t leave it too late!”
About the Speakers
Suzzane Wood, Partner & European Board Practice, Russell Reynolds
Suzzane specializes in board-level finance and NED assignments for leading global organisations. Suzzane’s extensive search and assessment experience covers all sectors as well as specialist roles, including tax, treasury, strategy, corporate finance, IR and audit & risk. Suzzane has been a speaker on the CFO Programme and has contributed to previous CFO Programme Network Events.
Chris Hill, CEO, Hargreaves Lansdown
Chris has considerable finance and accounting experience as well as operational and leadership skills from a number of business sectors, most recently as Chief Financial Officer at IG Group Holdings plc, a FTSE 250 online trading platform for retail customers and prior to that as Chief Financial Officer at Travelex. Chris qualified as a Chartered Accountant at Arthur Andersen and is an associate member of the Association of Corporate Treasurers. Chris is a CFO Programme Alumni, having attended the Next Generation CFO Programme: April 2012 and a CFO Transition Lab.
Sabine Benz, Director of Deloitte’s Senior Boardroom Relationship Programmes
Sabine is responsible for the strategic growth and governance of our executive level programmes, which includes programmes that support Finance Executives with their career aspirations. In her time at Deloitte, Sabine has worked with over 300 aspiring CFOs to prepare them for the breadth and complexities of a Group CFO role. Sabine also runs Deloitte’s CFO Transition Labs proposition, where she works with newly appointed CFOs and CEO’s on how to make the most successful transition possible into their role. Previously, Sabine worked in strategy and operations consulting with Burlington Consultants and AT Kearney.