Good morning,
It's the hottest job in finance right now—but it's not a permanent one.
The demand for interim CFOs is reaching new heights. To talk more about the trend, I sat down with Amelia Tyagi, CEO and cofounder of Business Talent Group (BTG), a Heidrick & Struggles company that provides project and interim executive talent for companies. BTG works with Fortune 1000 companies and global equivalents, private equity firms, and nonprofit organizations.
Using BTG proprietary data, “Every year we do a big analysis of all the requests, the themes, and trends that we're hearing in the markets,” Tyagi says. “We slice and dice that data.”
The most significant demand for interim execs in 2022 was in the office of the CFO, according to BTG’s 2023 High-End Independent Talent report released this morning. Interim CFO requests alone increased by 103% year over year at the firm, according to the report.
“That's the highest increase we've seen, and we’ve been tracking this since we were founded roughly 15 years ago,” Tyagi says. “We saw that interim CFOs represented nearly half of demand for all interim C-suite level requests,” she says. And the trend for interim CFOs has even grown in the first quarter of 2023, Tyagi says. “We think this is part of a longer-term trend."
Other finance roles are also highly in demand with controller taking the spot as the fastest-growing interim role (up 233% year over year), and 43% of interim requests at all levels originating from needs within finance (up 71% year over year). The majority of BTG's data is from leaders based in the U.S., some may work for global companies.
The report points to the growing complexity of the CFO role—and turnover—bolstering the need for interim finance chiefs. “The CFO office is transforming, and that is going to create some churn,” Tyagi says. “I think that company owners are looking to the CFO to achieve more and to do it faster.” And they’re looking for more flexible ways to achieve that, she says.
Interim CFOs are usually experienced because “they need to hit the ground running,” Tyagi says. “They’re absolutely serial CFOs.” She continues, “Being an interim CFO is usually a fairly intense, full-time role for six months or more. They're often choosing that path because they really like it.”
These interim CFOs can “take the reins, and really help them drive the function, very quickly,” Tyagi explains. “We also have situations where, for example, a company is experiencing rapid change, and they may not be ready to hire the permanent CFO, or they may need somebody on a transitional basis.”
“There’s also a trend toward CFOs being asked to do more than ‘just finance,’” she says. In a challenging economic environment, CFOs are often playing a role in cost and technology restructuring as well as being a real strategic partner to the CEO, she says. “And if it's an investor backed company, they're often the critical partner to the investor in achieving the investor's goals.”
BTG is seeing the need for interim finance chiefs broadly, across industries, Tyagi says. However, private equity-backed companies disproportionately seek out interim CFOs, she says. “Overall, I think we're all witnessing the transformation of the finance function, and the growth in interim CFOs is a part of that story.”
I asked Tyagi what findings really surprised her. "We expected to see growth in interim CFO demand, but the growth even surpassed what we expected," she says.
In these times of economic uncertainty, what's certain is CFOs are highly sought-after leaders.
Sheryl Estrada
sheryl.estrada@fortune.com
