The CFO role has transformed over the past two decades. Once primarily a financial reporting and control function, the modern CFO is expected to be a strategic partner, operational leader, and—increasingly—a leading candidate for CEO succession.
Yet many boards and CEOs search for CFOs using criteria that haven't kept pace with this evolution. The result: organizations hire technically competent finance executives who struggle to deliver the strategic impact the role now demands.
How the CFO Role Has Changed
From Scorekeeper to Strategic Partner: CFOs were once expected to keep accurate books, manage cash, and report results. Today's CFOs are expected to shape strategy, allocate capital, and drive business performance. They need to understand operations, not just finance.
From Backward-Looking to Forward-Looking: Traditional CFO responsibilities focused on reporting what happened. Modern CFOs are expected to predict what will happen—modeling scenarios, forecasting trends, and providing the analytical foundation for strategic decisions.
From Finance Function to Enterprise Leadership: CFOs now commonly oversee IT, real estate, procurement, and other functions beyond traditional finance. They're enterprise executives, not just finance leaders.
From Supporting Cast to Succession Candidate: Many organizations now see the CFO role as CEO development. CFOs are expected to build the broad business acumen and stakeholder relationships that prepare them for potential advancement.
Common Search Mistakes
Overweighting Technical Credentials: CPA, Big Four background, SEC reporting experience—these credentials matter, but they're table stakes, not differentiators. Many CFO searches over-filter on technical qualifications while under-weighting strategic capability.
Requiring Exact Industry Match: The CFO who can transform finance at a technology company may not have technology industry experience. Requiring exact industry match excludes candidates who could bring valuable outside perspective.
Mistaking Controller Skills for CFO Skills: Great controllers aren't automatically great CFOs. Controlling is about accuracy and compliance; leading as CFO requires strategic vision, business partnership, and organizational leadership.
Underweighting Soft Skills: CFOs need to communicate with boards, partner with operating executives, and lead finance organizations. Technical brilliance without communication skills and executive presence limits impact.
Ignoring Cultural Fit: A CFO who succeeded in a hierarchical, process-oriented culture may struggle in an entrepreneurial, fast-moving environment. Cultural fit matters as much for CFOs as for any executive.
What Great CFO Candidates Look Like
Look for candidates who demonstrate:
Strategic Orientation: Do they think like business leaders or finance technicians? Can they discuss strategy, markets, and competitive dynamics—not just numbers?
Partnership Capability: How do they describe their relationships with CEOs and operating executives? Are they trusted advisors or back-office support?
Transformation Experience: Have they improved finance functions, not just managed them? Have they driven change, or maintained status quo?
Communication Skills: Can they explain financial concepts to non-financial audiences? Are they effective with boards, investors, and employees?
Leadership Presence: Do they command respect? Can they hold their own in executive team discussions? Would you be proud to have them represent the company?
Structuring the Search
Define the Role Precisely: Before launching the search, invest time in understanding what you actually need. A growth-stage company needs a different CFO than a turnaround. A PE-backed company needs different capabilities than a public company. Define success specifically.
Look Beyond the Resume: Use structured interviews and assessments to evaluate strategic thinking, partnership capability, and leadership skills—not just credentials and experience.
Seek Diverse Perspectives: Include operating executives in the evaluation process. The people who will partner with the CFO should assess candidates' partnership potential.
Test Strategic Thinking: Ask candidates to analyze a real business situation. How do they think? What questions do they ask? Do they default to financial analysis, or do they consider broader strategic factors?
Check References Thoroughly: Reference calls should explore strategic contribution and partnership capability, not just technical competence and integrity.
The Board's Role
For public companies and larger private organizations, the board typically plays a significant role in CFO selection. Directors should:
Define Expectations: What does the board expect from the CFO beyond basic reporting? Strategic partnership? Board-quality investor relations? CEO succession potential? Make these expectations explicit.
Participate in Assessment: Directors with CFO experience or finance backgrounds should be involved in evaluating finalists. They can assess capabilities that others might miss.
Consider Succession: Is the CFO role part of CEO succession planning? If so, evaluate candidates against that potential, not just the current role.
The Bottom Line
The CFO search is too important to approach with outdated criteria or rushed process. Organizations that get it right gain a strategic partner who drives business performance. Organizations that get it wrong end up with a technically competent executive who doesn't deliver the strategic impact the modern CFO role demands.
Take the time to define what you really need, look beyond traditional credentials, and evaluate the capabilities that truly differentiate great CFOs from adequate ones.