CFO turnover at public companies reaches three-year high

In the first half of 2024, CFO turnover at public companies around the world hit a three-year high “after slower starts to the year in 2022 and 2023,” according to the Russell Reynolds Global CFO Turnover Index.

In the first half of this year, the CFO turnover rate hit 8.9%, with a total of 163 CFOs appointed at public companies on 12 major stock indexes, including the S&P 500 and FTSE 100. The report’s authors note the climb suggests that “as economic uncertainty becomes the new normal for organizations, previous trepidation to replace CFOs has dissipated.”

In any case, the turnaround speed is increasing: Average tenure for an outgoing CFO dropped to a five-year low of 5.7 years in the first half of 2024. Retirement is a common reason for departure: 54% of CFOs who left in the first half of 2024 left their roles to retire or move exclusively to board roles, marking a 15 percentage point year over year jump and a five-year high.

More than half (56%) of incoming CFOs around the world in the first half of 2024 were internal hires. But the trend’s not evenly distributed worldwide: “The Nikkei 225 and Hang Seng’s CFO appointments were almost exclusively internal,” the report’s authors noted, but in stock exchanges with a more Western bent, “there was a greater reliance on external appointments.”

Still, for companies listed on the S&P 500, a majority of CFOs appointed in the first half of 2024 were promoted internally (62%), which is somewhat surprising, given recent findings from Deloitte that 25% of North American CFOs lack a formal succession plan. Seven in 10 (71%) of S&P CFOs who started during 2024 were first-timers.

And a more pleasant surprise: A third of CFO appointments among S&P 500 companies in the first half of 2024 were women, marking “the highest percentage of women CFO appointments in the past five years,” per Russell Reynolds.