There is a disconnect between where the finance office needs to go and the talent it will need to get there, according to a Deloitte Consulting LLP global survey, "The Finance Talent Challenge: How Leading CFOs are Taking Charge." The study, developed in cooperation with the Economist Intelligence Unit (EIU), discovered that a new breed of talent is needed to propel the finance function beyond traditional roles within a company and to a new level of strategic leadership.
"The responsibilities of CFOs are growing each day as the focus of the finance office shifts from traditional accounting and reporting to more strategy and leadership, and the need for top talent intensifies," said Steven Ehrenhalt, a principal with Deloitte Consulting. "The survey found that many organizations lack the ability to align finance with businesses objectives, as well as to help reach company goals. Attracting the talent needed to help reach these goals is a challenge. According to the survey, 35 percent of CFOs said that recent graduates do not see the finance function as a career launcher."
The Finance Talent Challenge survey is a compilation of first-hand accounts from CFOs and includes responses from 636 financial executives across a variety of industries. The study reflects insights on a range of issues, including the evolving role of the CFO, the future of the finance function, and the challenges related to attracting and retaining talent.
"Few companies are doing what it takes to lure top talent, with only 33 percent of executives agreeing that their finance organization markets finance as an attractive career option or destination. CFOs must lead the charge to re-brand the finance function as a career with great potential for growth and advancement," said Ken Kunkleman, a principal with Deloitte Consulting who specializes in human capital services.
Despite the evidence that financial executives are not yet committed to solving the finance talent challenge, Ehrenhalt remains optimistic, citing four vows that CFOs must take to begin the turnaround. He noted that CFOs must commit finance to creating value, developing and nurturing new finance leaders, branding finance as a career launcher and commit to attracting, developing and retaining top finance talent.
Key findings of the survey include:
Financial Planning and Analysis professionals are highly sought-after as future finance leaders - and rank first among the functional groups or positions that provide the primary pipeline for the finance organization’s leadership, but these people are among the hardest to find.
Many finance organizations do not capitalize on the graduate pool. Fifty-two percent of CFOs say internships are a valuable tactic in attracting high-potential students and boosting a company’s reputation, but 35 percent of CFOs say one of the most significant challenges in attracting talent is that recent graduates don’t see their company’s finance organization as a career launcher.
Career development is critical to high-flyers, and yet many companies prevent finance talent from pursuing opportunities outside of finance. Career advancement tops the list of frequently cited reasons that talented finance people give when they quit, but only 46 percent of respondents agree that their finance leaders routinely develop talent as a part of their career development programs.
Furthermore, few (28 percent) agree finance routinely provides talent with opportunities outside of finance, and 38 percent say their finance organizations are reluctant to release talent to other departments within the company so they can further develop their skill sets and increase their knowledge of the company. This runs contrary to the expectation that finance professionals have a strong knowledge of, and feel for, the business.
The issue of finance talent and demand is truly global. Sixty-seven percent of respondents from Asia-Pacific cited that the current supply of finance talent is either limited or inadequate, with 54 percent of respondents from Eastern Europe; 53 percent from Asia-Pacific; 52 percent from Western Europe; and 47 percent from North America stating that finance talent will be limited or inadequate in three to five years.
Nearly 80 percent of Public Sector respondents cited an inadequate or limited supply of finance talent, with Life Sciences and Healthcare at 65 percent, and Consumer Business at 67 percent. This compares to 58.7 percent of total respondents. Nearly 60 percent of Life Sciences and Healthcare respondents expect the supply of talent to continue to be inadequate - or limited - in three to five years.
Respondents came from various geographic areas, including 46 percent from Eastern and Western Europe, 31 percent from Asia-Pacific, Africa and the Middle East, and 23 percent from North and South America. Twenty-five percent were in the Financial Services industry, while 16 percent came from Manufacturing, 13 percent from Consumer Business, and 14 percent were from technology, media and telecommunications companies. Eleven percent of the respondents were within the Public Sector.