Long-serving CFOs good for shareholder returns - report


The executive recruitment firm found in examining C-suite executives at 673 of the biggest US businesses - listed on the S&P500 or Fortune 500 or both - that 85 CFOs had kept their demanding jobs for a decade, 21 more than had done so 10 years earlier.

It was found that seven of the 10 longest-serving finance chiefs helped run companies whose returns to investors outperformed the S&P 500 index. Those businesses include Raymond James Financial, health-care information-technology company Cerner Corp and energy-drinks maker Monster Beverage Corp.

According to the research, the average tenure of CFOs at Fortune 500 companies increased to 5,7 years in 2016 from 4,7 years in 2005 - an indication of a growing board preference for veteran finance bosses to complete lengthier stints in their posts. These experienced financial executives are seen as being better able to handle internal challenges, such as executive changes and organisational upheaval, and external threats, such as those posed by economic downturns.

The annual Crist|Kolder Volatility Report examines the backgrounds and measures the turnover of C-Suite executives in a portfolio of the USA's leading companies, including the Fortune 500 and the S&P 500.

Crist|Kolder Associates examines each of the portfolio companies individually, noting personnel and organisational changes in the CEO, CFO, and COO roles. Each executive's background is explored, including the path taken to get to their current role: industry background, functional experience, and education. This includes demographic information such as age, gender, and race. The report tracks data back to 1995.

Related articles