August 19, 2020 – Pietro Sartori is a senior associate with Wilton & Bain. He joined the firm in 2017 after graduating with distinction in global business management at Coventry University. He works in the CFO & board practice at WB Interim as well as focusing on private equity markets. Mr. Sartori specializes in placing board level and senior executives in finance, strategy and HR across the U.K. and European markets. He has a genuine interest in understanding management best practices and complex business issues, particularly those on the agenda of
CFOs and private equity investors.
Mr. Sartori recently sat down with Hunt Scanlon Media to discuss recruiting CFOs the vast new challenges these executives are encountering in the face of a global pandemic.
Pietro, how has the current health and economic crisis affected CFO succession plans?
In normal conditions, CFOs think about and plan the long-term sustainability of the finance function. They build benches below their direct reports so that the function remains strong even if individuals leave. Succession planning pipelines, both internal and external, are therefore devised in advance. The current health and economic crisis caught many businesses unprepared when it comes to succession plans, particularly in roles below the executive level. While the vast majority of organizations had rigorous business continuity emergency plans from an operational perspective, few had considered the people element and how to prevent disruption if something happens to critical employees. This added an extra layer of risk on the CFO plate –employee health.
Explain the importance CFOs play in managing employee health
Managing employee health as an enterprise risk requires a different type of leadership from CFOs, one that is highly empathetic and people-driven rather than purely result-oriented. Excessive focus on performance increases the risk of employee burnout and can drive bad choices with severe health risk implications. These can ultimately have serious repercussions on the business from a performance, morale and even legal perspective. Empathy as well as common sense are thus key and directly linked with an organization’s ability to navigate this crisis. CFOs have to be present with their reports and the general workforce. The frequency of communications should be increased, leveraging technological tools to connect with them when face to face interactions are not possible. It is critical to keep an eye on the team’s energy levels and be aware that the finance team, as well as many other employees, will look at the CFO for guidance and will mirror their behaviors. A calm yet focused approach offers reassurance and confidence.
What else do CFOs have on their plate during these times?
Equally, as CFOs spend more of their time addressing burning financial and strategic issues such as cashflow and revenue decline, they cannot afford to have gaps in their teams, especially in roles that are critical to keep the business solvent. Hence the need for a talent map of the finance function in order to understand what skills are required to fill unexpected gaps with internal resources. The CFO should have a contingency plan to go to the external market in case no internal talent is available. Fill-the-gap interim solutions can be a valuable resource in times of emergency, particularly given the current availability of skilled talent in the market.
How do companies replace CFOs during times of crisis?
In the eventuality that the CFO itself is the role that needs replacing, the solution will be relative to the specific circumstances that led the post to be vacant. If the situation is caused by a temporary health emergency, the existing internal team should be the first place to look, perhaps supported by additional interim resources to avoid over-stretching key executives. On the other hand, if the CFO needs to be replaced on a permanent basis, businesses should look for experience and track record of delivery. Leading a business in a time of crisis and hitting the ground running in a new business are in themselves major challenges which may prove overwhelming for someone with little experience in an executive seat.
How will this role continue to evolve in the future?
Once pressing short-term needs have been addressed, CFOs will look at building capabilities and capacity for growth during recovery. They will switch mode from crisis management to strategic planning, looking at investments and productivity initiatives to position their business to win after the pandemic. Before COVID-19, we were already experiencing a trend seeing the role of the CFO evolve from a traditional finance leader to a fully-fledged business leader instrumental in driving business strategy. As with many other trends, the current crisis will only accelerate this transformation.