How Interim CFOs Can Drive Growth and Stability During Transformation

The role of the CFO has changed dramatically. No longer simply the guardians of financial management, compliance, and reporting, modern CFOs are strategic partners, data analysts, and risk advisors, juggling an ever-expanding set of responsibilities. As businesses seek to upgrade their financial capabilities and navigate increasingly complex landscapes, the demand for interim CFOs has surged by 103%. But what's behind this trend?

While the early days of the pandemic saw many CFOs staying put, driven by loyalty and the appeal of internal candidates, a complete reversal has taken place. According to a recent Deloitte study, new searches dropped by 25% between March and May 2020. However, the current market paints a very different picture, with demand for CFOs experiencing "breathtaking volume and velocity." There are key factors to note fuelling the rise of interim CFOs:

1. Rapid Growth and Challenging Financial Situations:

The pandemic presented unique opportunities and challenges. Some companies capitalised on mergers and acquisitions, requiring turnaround expertise. Others faced unprecedented economic hardship. While incumbent CFOs excel at "running" the finance function, building it for rapid growth, debt restructuring, or operating under tight cash flows often demands external perspective and experience. Interim CFOs bring proven solutions gained from diverse engagements, helping companies navigate any financial climate.

2. Widespread Transformation and Critical Transitions:

From remote working to automation, the pace of change has accelerated. CFOs are now co-leaders in these transformations, demanding strong leadership during critical transitions. Deloitte even reports a 42% increase in CFOs acting as co-leaders, highlighting the need for experienced guidance. Interim CFOs offer immediate expertise when companies need it most, ensuring continuity and progress even during leadership gaps.

3. Anticipated Rebound in Public Exits:

Taking a company public involves navigating SOX, IR, and other regulations. Many private company CFOs lack this expertise. Experienced interim CFOs can guide the finance function through this highly regulated process, preparing them for the demands of being a public company.

4. Unexpected CFO Departures and Executive Exhaustion:

Pandemic fatigue, burnout, and the evolving CFO role are leading to increased turnover. With the search for a permanent replacement being lengthy, interim CFOs provide stability and leadership, bridging the gap until the ideal candidate is found.

Finding the Right Interim CFO in a Tight Market:

The current CFO talent market is highly competitive, making it crucial to adopt creative strategies as suggested by Deloitte:

• Expand your search: Consider candidates from different industries or adjacent areas like controllership or treasury.

• Look beyond traditional experience: Explore candidates with expertise in other financing transactions, not just IPOs.

• Prioritise transformation skills: Seek CFOs experienced in leading digital transformation initiatives.

• Value strong communication: Effective communication with C-suite peers and investors is crucial.

• Embrace diversity: Actively seek candidates from diverse backgrounds to access a wider talent pool.

By considering these strategies and leveraging the expertise of interim CFOs, companies can bridge the talent gap and navigate the evolving financial landscape with confidence.

How Can You Utilise Interim CFOs:

• Traditional Interim CFO: Provides leadership and keeps operations running during temporary absences.

• Support for Acting Finance Leaders: Offers guidance and consultation to internal personnel filling the CFO role.

• Backfill for Internal Talent: Supports specific needs like interim treasurer or VP of FP&A during leadership gaps.

• Project-Focused Interim Role: Addresses specific projects and niche requirements.

Finding the Right Interim CFO with us at Trace:

We take a bespoke and discerning approach to connect you with the perfect interim CFO. Our highly experienced team leverage their extensive industry expertise to curate a select group of qualified candidates who possess the precise skillset and experience to meet your unique needs. Whether navigating growth, overcoming challenges, or transitioning leadership, we ensure you find the ideal interim CFO to guide your company towards sustainable success.

Connect with us today to discuss your specific requirements and discover how Trace can assist you in securing the perfect interim CFO addition for your unique business gaps.