From finance to the top (Part 5): Lessons from history and a passion for people

According to fresh results from this year's CFO Day Survey, nearly three quarters of all CFOs are eyeing the top job and aspire to be CEO after their current role. And their ambitions are not unrealistic: a third of all CEOs of the JSE Top-40 are previous finance executives. But what does it take to scale the highest summit? Which different skills are required? How do you move from numbers to people and strategy? CFO Magazine spoke to five former CFOs who were promoted to CEO to find out what it takes.

Understanding people is crucial to the CEO role, says Peregrine Holdings CEO Robert Katz. He’s so passionate about this aspect of leadership that he says if he had his time over, he would have studied psychology.

Before Robert Katz was appointed the CEO of Peregrine Holdings in 2017, he’d held the CFO position at the company for seven years (and subsequent to this interview, he is now holding the position, as well as the CEO role, again). But the transition into the CEO role wasn’t a difficult one. “The CEO’s job and the CFO’s job are not all that different. You attend the same meetings. You have a detailed feel for the numbers. You’re at one with the business and its subsidiaries,” says Katz.

Katz was never the kind of CFO that closed himself off behind a desk and a wall of numbers. He chose to be involved at the highest level and to know all aspects of the business intricately. “If you were the CFO that focused purely on the financials, then yes, the changeover would be hard,” he notes.

When considering the key characteristics of a CFO, being a dynamic people person is not among the top three on the list. But if one steps into the shoes of the CEO, possessing emotional intelligence and dealing with the complexities of the human condition are essential. Katz’s passion for understanding the human heart and mind is intrinsic. He valued people in his CFO days and continues to aspire to near-perfect people management.

“As a CEO, I can’t tell you how important it is to have knowledge about people – their drives and motivations. To understand their ebbs and flows. In fact, if I had my time over, I would definitely have studied psychology,” says Katz.

Genghis Khan, the ruthless and bloodthirsty leader of the Mongol Empire, would beg to differ. His autocratic leadership style may have advanced the expansion of the empire and he may have gotten things done, but Katz believes this kind of management style is outdated and inefficient.

“Long gone are the days where it’s the CEO’s way or the highway. To be an efficient leader, you need to collaborate, listen and be truly inclusive. I don’t want to be a dictator; I’d rather lead by example and facilitate the process by those who work with me can be the best that they can be,” says Katz.

For people to be genial and productive, he says that “the three legs of the work happiness tripod” must be strong. The first leg of the tripod is salary and fair remuneration; the second is the people one works with and; the third is meaningful and fulfilling work. “In my 30 years of experience, if one of those legs becomes wobbly, everything else falls apart and the person is sure to leave the company. You can earn a fortune but have a tyrannical manager, and you’ll be miserable. The trick is to get all three legs of the tripod in balance.”

Katz says that being a CFO taught him how to hold it all together. “It’s all very relentless – budgets, half-year revised estimates, year-end financials, quarterly reviews, monthly board meetings…As a listed company, you’re heavily scrutinised and there’s not a lot of margin for error.”

But Katz says that he was born with high energy levels. He has always been restless and ambitious and easily exists on five and a half hours of sleep each night, whether it’s a work day or not.  He has a passion for Russian history, and is currently reading the works of little-known Russian author Vasily Grossman, whose literary tome Life and Fate is what Katz believes to be the twentieth-century equivalent of Tolstoy’s War and Peace.

“While I am fascinated by the Russians, I certainly don’t follow the Stalin five-year plan in business. I don’t even think we can make three-year plans with the rate of change we are experiencing,” says Katz.

Before joining Peregrine Holdings in 2010, Katz was Standard Bank’s finance director of Retail Banking for eight years. He had previously been the CEO of Educor, and then the director of Microsoft SA. His seamless switch between CFO and CEO is historically rooted.