Dive Brief:
- Stephen M. Scherr, 57, has been named CEO of Hertz Global Holdings, Inc., effective Feb. 28. He is making the jump after nearly three decades at Goldman Sachs, where he became the bank's chief financial officer in 2018.
- Scherr will receive a base salary of $1.5 million as part of a compensation package that also includes a performance-based annual bonus with a target of 160% of the base salary, according to an SEC filing.
- The move comes as the percentage of sitting CEOs at Fortune 500 and S&P 500 companies coming from internal or external CFO positions ticked up to a 10-year high of 7.9% last year from 6.6% in 2020, according to Josh Crist, a co-managing partner at Crist|Kolder Associates and a recent report from the firm.
Dive Insight:
Hertz’s choice of Scherr is the latest example of the CFO position being an increasingly common C-suite stepping stone to a CEO seat in the pandemic.
At the same time, the broader skills that CFOs are gaining as they have taken on both operational and strategic responsibilities in recent years rather than being siloed in narrowly defined finance roles are shaping leaders who are increasingly attractive CEO candidates, Crist told CFO Dive.
“CFOs are not just bean counters anymore,” he said. “They’re much better prepared for the CEO promotion.” He expects the percentage of CFOs making the move to the top spot to continue to rise. Hertz's pick of Scherr is also a good choice for Hertz because his deep banking ties will likely be helpful if the company needs financing as it rebuilds, Crist said. “He’ll bring baked-in relationships to lenders across the board,” he said.
Scherr is taking the reins of the rental-car company as it is benefiting from a rebound in travel following a tumultuous period that included a 2020 bankruptcy, a restructuring and a relisting of shares last year, according to The Wall Street Journal.
Private equity firms Certares and Knighthead Capital Management LLC, part of a group that bought Hertz out of bankruptcy, have representatives on the Hertz board and were involved in selecting Scherr, a Hertz spokesperson said.
In a statement Greg O’Hara, chairperson of Hertz’s board and founder and senior managing director at Certares, said Scherr is the “leader Hertz needs to grow our business and to have a formidable position in the future of mobility and fleet management.”
Scherr, the principal architect of Goldman’s new consumer business who helped to build Marcus by Goldman Sachs and led the launch of AppleCard, is joining Hertz as it executes on its core priorities of shared mobility, electrification and a digital-first customer experience, the statement said.
