Philadelphia — Feb. 27
Fifty percent of the chief financial officers who left companies did so for reasons other than finding another job, including inability to fit culturally into the organization, the increasingly stressful demands of the position and lack of current knowledge related to Sarbanes-Oxley, according to a survey by Right Management.
CFOs lasted in their positions for more than five years at 48 percent of the 191 organizations surveyed. CFOs stayed in their jobs for less than three years at 25 percent of companies surveyed, however.
It typically takes between three and five months to replace a departing chief financial executive, according to the survey.
Respondents mainly consisted of human resource managers and executives at midsized to large organizations in all industries.
“Many chief financial officers had the same ‘cultural fit’ problems that are a leading cause of executive failure — their management styles and ways of doing their jobs did not fit in with the prevailing organizational culture,” said Doug Matthews, president and chief oerating officer of Right Management, a provider of integrated consulting solutions across the employment life cycle.
CFOs also have been under increased job stress since the implementation of the Sarbanes-Oxley Act of 2002, the corporate disclosure law passed by Congress in the wake of accounting scandals at a number of major publicly held companies.
“The strains that Sarbanes-Oxley placed on the job are still present,” Matthews said. “Some CFOs have not adjusted to the greater duties and increased responsibilities that a chief financial executive for a public company must now confront.
“In addition, the job market for CFOs has been good in recent years, with new opportunities at other public companies that are under greater Sarbanes-Oxley scrutiny and with privately held companies that were not affected by the legislation.”
According to the survey, CFOs who left companies did so for the following reasons:
- Accepted another job offer: 50 percent
- CFO did not fit into culture of organization: 23 percent
- Work environment and/or job was too stressful: 22 percent
- Lack of current knowledge around Sarbanes-Oxley regulations: 5 percent
The average tenure of a CFO is:
- Six to 10 years: 28 percent
- Three to five years: 27 percent
- Up to three years: 25 percent
- More than 10 years: 20 percent
It typically takes this long to find a replacement CFO:
- Three to five months: 34 percent
- Six to 12 months: 26 percent
- One to two months: 22 percent
- Less than one month: 11 percent
- More than 1 year: 7 percent