A news release from executive services firm Tatum, LLC said a survey of partners in the firm’s Executive Practice found that more than 93% predicted 2007’s CFO turnover would eclipse the 2,302 who departed in 2006. Some 7% called for fewer CFO job separations.
“We are approaching an inflection point in the office of the CFO, and corporate America may soon find that creating shareholder value is impossible with what is quickly becoming an itinerant CFO,” said Richard D’Amaro, Tatum Chairman and CEO, in the news release “Many CFOs are fired or resign not because they weren’t a good match for the company when they were hired 20 months ago, but rather because the business has evolved so quickly that their capacity and capabilities are no longer an ideal match for the company.”
According to the news release, 37% of respondents cited compliance and governance issues as the primary driver of turnover, which was followed closely by unreasonable expectations from board members and other stakeholders at 30%.
Also contributing to the malaise was tension in achieving a work/life balance (13%), CFO skills not aligning with the natural evolution of a business (12%) and inadequate IT infrastructure supporting business needs such as financial reporting (6%).
To stem the CFO turnover tide, more than a quarter (27%) said providing additional resources such as specialized staff to support expanded duties like working extensively with board members and overseeing compliance activities, while 25% suggested that deregulation and relaxed compliance/governance requirements would help do the trick.
Additionally, 23% said more support from board members would help, while 14% felt improved mentoring/professional development programs would help. Finally, 11% said better alignment between technology infrastructure and business demands would slow CFO turnover.
The survey was conducted in January 2007 and polled 163 of Tatum’s more than 500 Executive Practice partners.
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