Jeff Thomson, CEO of the Institute of Management Accountants, has a strong pitch: across the entire c-suite, CFOs are best suited to serve as CEOs.
In the U.S., the evolution of the CFO role has been taking place over decades," Thomson told CFO Dive Thursday. “And the evolution always starts with core accounting.”
Thomson said over time, the reach of the evolution has extended to finance, operations, strategy and technology. Even if CFOs don’t directly manage these departments, they still retain significant leverage over them, which Thomson attributes to CFOs’ natural function as overseers.
"When I was CFO of a big business unit at AT&T, I had a lot of strategy responsibility," Thomson said. "At my current company, we have 144,000 members in over 100 countries, and our CFO has responsibility for all those things: operations, tech, finance and accounting."
If a CFO can fine-tune your competency in each of those areas, Thomson said, "you’re in a very good position to go beyond that technical accounting."
A recent CFO to move into the CEO role came this week when German consumer goods giant Henkel promoted Carsten Knobel, a 25-year veteran of the company. The move was panned as too conservative by analysts, who said Knobel would be unlikely to bring the structural changes the company needed.
"I could, on the one hand, understand, from a pure, outside-looking-in perspective that it’s too conservative, and that you need to bring in someone from the outside," Thomson said. "[But] the nature of the [CFO] position, if he or she is a true business partner and strategic advisor, they’re kind of like the CEO in waiting."
To the extent Knobel is forward-looking, Thomson said, he supports his promotion. "If [he] demonstrates the innovation, drive, understanding of broad strategy, and knowledge of functions like sales and marketing, then that individual should be a great candidate," he said. "And don’t assume that an internal hire can’t shake things up, too."
Positioned to lead
Even if a CFO hasn’t been with the company for many years, Thomson asserts that there are always things he or she can do to move towards the CEO role.
"Team up with the board of directors, with investors, and with customers," Thomson recommends. "Proactively seek those more external interfaces. Emulate what the CEO does, in a value-adding way, to these external constituencies ... like investors and the board of directors."
Other key objectives should include a deep understanding of the business — beyond the finance silo and department — including sales and marketing, and consumer behavior. "Be involved in new market entry, too," Thomson said. "Go beyond financial numbers and into market aspirations, beyond accounting and business acumen."
Thomson recognizes that CFOs, more than many executives, have needed to become "anticipatory" of possible setbacks or roadblocks within their rapidly changing digital world.
"It’s great to be agile, but that’s more reactive — like, if something happens, then I respond," Thomson said. "But being anticipatory, and a futurist, is really what, I think, is required.
"Add that insight and foresight that CEOs are expected to deliver, on behalf of the board of directors and customer and shareholder base," Thomson said. "If CFOs can do that, they’ll be very well-positioned."
