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In the US’s largest companies, more CFOs are being tapped for CEO roles. According to the latest Crist Kolder Volatility Report, in 2023, among Fortune 500 and S&P 500 companies, 8.4% of CEOs were promoted directly from CFO positions, up from just 5.8% in 2013.
Turns out, the trend toward hiring former CFOs as CEOs exists at US companies of all sizes. New data from Live Data Technologies shows that in 2023, 4.56% of CEOs across companies of all sizes were former CFOs. That’s up from 3.58% in 2018. Early data from the first two months of 2024 suggests it might be an even better year for CFO-to-CEO promotions: 4.93% of new CEOs had held CFO roles.
The percentage of CEOs who are former CFOs has increased modestly every year from 2020 (3.49%) to 2024, Live Data found. That may be a sign that more companies are looking for CEOs with financial acumen to steer them through chaotic macroeconomic times and periods of high inflation, as Rich Brady, CEO of the American Society of Military Comptrollers and global chair of the Institute of Management Accountants, suggested to CFO Brew during a recent interview.
Live Data examined 360,000 instances between 2018 and February 2024 when someone was promoted to CEO, and used Search Engine Results Page (SERP) analysis to track their job history and the size of the business where they worked.
Bigger companies are better bets for would-be CEOs: Midsize and large companies are more likely to choose former CFOs as CEOs than small ones, Live Data found.
In 2023, only 2.47% of CEOs at companies with fewer than 100 employees had CFO backgrounds, compared with between 6.22% and 6.81% of companies larger than that. Companies with 1,500–5,000 employees had the most CFOs-turned-CEOS.