This article is borne of curiosity following a number of comments made to us. A handful of people that work in and around HR informed us that the Chief Financial Officer (CFO) and Finance Director (FD) roles are their biggest problems right now. Why? The need to exit them and the difficulty in replacing them. Why? Behaviours and cost pressures. Why? No idea. Well, according to research from a related HR publication, they found that the CFO/FD role tenure is 14% shorter than the C-suite average. This is from research at the back end of 2025. Hmm, what is happening to CFO and FD tenure in the boardroom?
The evolving role of the CFO and FD
No longer a transactional bookkeeper, the CFO/FD must now act as a strategic advisor to the board. They must navigate sustainability reporting, geopolitical machinations, digital transformation, the rise of AI and increased fraud/risk/cybersecurity worries. These are just a handful of challenges. Teams may not be collocated, possibly in multiple locations, offshore, in different time zones and in offices or at home. Additionally, many CFOs and FDs may oversee other functions such as internal audit, IT, compliance, transformation, HR and others. Whilst this can make a CFO/FD position quite powerful in the organisation, it may mean juggling many plates.
Evolving pressures on the CFO and FD
At the present time, with increasing regulation, geopolitical issues (e.g. tariffs, supply chain disruption etc) and tax changes, many CFOs have been under pressure. Those with access to data analytics, sophisticated reporting tools, AI models and other software tools command vast data resources. As such, they have to look back, look forward and forecast out for a multitude of scenarios. The result is a guide to future strategic choices and the associated financial consequences or benefits.
One thing that has always been the preserve of the CFO and FD is tight control over costs and the need to become more efficient as a function. Many aim for a finance function that costs less than 2% of revenue. With AI, slowing global growth and tariff/tax impacts, the result is increased pressure on the role and reducing envelope of costs. Let’s check what is happening to CFO and FD tenure.
CFO and FD tenure
Some estimates suggest that around ½ of the CFO/FD exists last year were retirements. Furthermore, around ½ of the replacements came from within. Some have labelled this a ‘CFO exodus’, with news outlets citing stress, burnout and technology fears. It wasn’t so long ago that marketing was the problem child of board tenure, but that accolade has shifted to finance. The CFO also appears to spend less time overall at the company than other board members, at roughly 1-year shorter tenure. Of course, the churn is not isolated to the CFO/FD. There is an acceleration of CEO turnover as companies grapple with economic turbulence, regulation and tax burdens. As a result, the majority of CFOs tend to leave within 6-12 months of a CEO departure.
The need for CFOs and FDs to display greater emotional intelligence is well-documented, especially since the COVID-19 pandemic. Additionally, there is greater need to be a visible leader, technically savvy and Environment, Social and Governance (ESG) aware. With the evolution of the role from scorekeeper to leader and strategist, it may be that many have not developed along with the demands on the role. It is no surprise that around ½ of people that leave finance and accounting roles do so because of huge workloads and burnout. Coupled with bad management, toxic cultures and low remuneration, it is little wonder that talent for the CFO/FD role is scarce. Average UK accountancy salaries have increased by between 35% (starting) and 55% (median) since 2005. However, UK inflation according to the Bank of England was almost 80% over the same time period.
Transforming finance for 2030
An article that began with curiosity seems to have obvious reasons behind it. However, if retirements are happening earlier (some suggest as early as 54 years of age), the challenge will become more acute. Similarly, if AI adoption is tearing through finance functions everywhere to cut costs, it is likely to push many teams and leaders to the edge. So, what do we do about it as we head towards the end of the decade? Is AI the main reason for the exodus? Are we in a short-term slump due to tariff/tax/regulation changes?
There are a number of problems in the finance profession, one of which is the ‘glorification’ of a long-hours culture. This pervades practice through to industry. The other is the increase in burdens placed upon the function, increasing workloads and forced, rapid adoption of AI. Finally, there is the spectre and reality for many of AI-enabled roles. Where once it was considered enough to outsource, then it was to automate and now it is to speed up with AI. It may eventually be the case that the function shrinks considerably, leveraging multiple AI agents, as is happening in shared service centres.
Ultimately, the challenge is stark. Understand the numbers, understand business performance, comply with ESG, GDPR, corporate governance codes, regulations, tax changes, digitally transform, replace team roles with AI and more. Perhaps they need support to transform. Perhaps the role is becoming too large and complex for one person. Maybe, it is being forced to change in ways it has resisted for too long.
Supporting digital transformation and future finance
As a management consultancy, we specialise in planning and executing change. Our co-founder is an ex-Finance Director and FCCA with experience in multiple sectors across owners, boards and leadership teams. Having seen problems from management to systems and falling behind on analytics and direction, let’s stop the talent exodus.
If you would like to engage an ex-FD to support your change, simply contact us via our website. Alternatively, why not email the team at sales@think-beyond.co.uk (unsolicited spam ignored).
Finally, if interested, please check our other content about finance first and finance fighting inflation.