Based on a survey of 261 private equity portfolio CFOs and conversations with key CFOs, talent partners and investors, our latest Portfolio CFO Analysis looks at what it takes to be a successful CFO in 2023. The results from our survey emphasise the need for investors looking to attract the best talent to understand what makes an attractive offer – and how to support successful CFO performance in 2023.

Section 1: Portfolio CFO market trends

The CFO market is buoyant despite fewer deals. Our survey reveals that 75% of our CFO respondents would be open to moving to a new opportunity in the next 12 months. This presents a significant risk factor to investors concerned with maintaining the stability of existing portfolios in a challenging economic climate.

Investors have shifted their focus to optimising the companies they currently back. This is placing greater scrutiny on the delivery of their portfolio management teams and on the CFO. This increased pressure is driving movement in the CFO hiring market, generated by both an increased willingness from CFOs to explore their options and by investors seeking to replace an incumbent CFO.

CFO are optimistic – 72% expecting medium level to exponential level growth.

  • 82% expressed confidence in receiving the right level of investor support. Investors are working collaboratively with their portfolio management teams to navigate the current industry challenges.
  • Despite this 64% of CFOs are expecting a negative impact on their business’ exit plans this year.
  • Over 2/3 of respondents expected negative impacts on their tenure including personal equity dilution and an inability to invest in growth.

Section 2: Success factors for the CFO

Business performance and financial reward are key concerns. The ongoing demand for experienced and highly competent CFOs in a competitive market indicates a significant risk factor which investors need to be aware of.

  • The business not performing according to expectations (34%) is the leading reason for CFO to consider a move.
  • 33% say feeling financially undervalued would be a key push factor and a further 28% felt a change in equity structure as a key reason.
  • Operational excellence is the key to CFO success. The PE CFO role is increasingly inwardly focused with the aim of improving business performance.
  • 57% of CFO say retention and recruitment of new team members is the biggest challenge this year.
  • Commercial acumen, strategic mindset and strong PE experience remain as key competencies. Investors are increasingly interested in change agents given the transformational agendas and focus on operational excellence of most portfolio companies

Section 3: How to secure the best CFO talent

Time is of the essence. Our analysis highlights that investors are typically acting decisively in this fast-moving market.

  • Over 60% of our respondents cited that their last CFO role process took less than 2 months from first interview to offer and a third took less than 1 month.
  • 52% had not undertaken either a case study or competency/personality assessment in their last role.

Key drivers for CFOs to accept an offer:

Relationship with the CEO over financials – 58% of CFOs valued the relationship with the CEO.

Clear indication of business performance – 81% felt that the disclosure of current financial information was essential in determining whether a role was right for them.

Culture – nearly a third of CFOs cited business culture as a key determining factor in selecting a role.

The right compensation package  – A third of CFOs will consider a new role if they feel financially undervalued and both salary and equity are key considerations upon accepting a job offer.