Study finds CFO resignations rocketed in 2004
CFO resignations at Fortune 500 companies went up 21% during 2004 and overall turnover rose 23%, according to a study by Russell Reynolds Associates.
The global executive recruiting and assessment firm conducted a study in the first quarter of 2005 analyzing the rate of change in 2004 from 2003 among CFOs, controllers and treasurers of Fortune 500 companies.
"The increased and relentless pressures of Sarbanes-Oxley compliance and the competitive drive to beat the numbers every quarter are two factors driving rising turnover among financial officers," said Lorraine Hack, a member of Russell Reynolds Associates' Financial Officers Practice. "Many CFOs and controllers rise to the occasion; but some decide to opt out of public company top roles, too. Being a financial officer of a publicly traded company has become more challenging and less attractive with compliance demands, so companies must keep scouting new talent."
Mirroring the CFO trend, there was a 25% increase in overall turnover of Fortune 500 controllers and a marked 400% increase in the rate of resignations. A major contributor to controller turnover is a 29% increase in the rate of promotions.
Of the three financial officers studies, only the role of treasurer showed no increase in the rate of turnover in 2004.