CFOs are swarming for the exit doors as SOX deadlines approach—we’ve never seen anything like it says leading C-level recruitment firm
I was over at Korn/Ferry, the leading C-level executive recruitment company, the other day discussing trends in Silicon Valley and other sectors. I was chatting with Richard Spitz, Global Managing Director, and Jeff Hocking, Office Managing Director. They said there are an unprecedented number of chief financial officer positions vacant.
“It’s about three to four times the number we usually see,” said Jeff Hocking. In a normal year, Korn/Ferry handles about eight or nine CFO searches.
And the CFO exodus is likely to grow even larger.
“We are having CFOs call us and say ‘get me into a private company as soon as you can,’” said Hocking. “Nobody wants to be the first test case.”
SOX is a complex set of rules and guidelines and there are some gray areas that will have to be defined through the courts. CFOs could also be more vulnerable to civil lawsuits.
“Some of the vacancies are due to revenue recognition problems at various public companies but many others are due to the Sarbanes-Oxley requirement for signing off on financial results and this approaching deadline is causing many CFOs to retire early or change jobs,” said Richard Spitz.
SOX compliance is costing companies at least $2m a year to install the IT systems and hire the extra auditors to audit the auditors. Many CFOs fear that they could be used as scapegoats if there is a problem.
Computer Associates on Wednesday announced it had appointed a new CFO, completing a nine-month search. This was a coup for Korn/Ferry, which was hired in late 2004 after other recruiters had failed to find a suitable candidate.
Here is the News.com story: CA snags Dell's chief accountant
Computer Associates had plenty of accounting problems and the SEC investigated the software company. But the software firm has now replaced virtually its entire top management, and brought in some of the nation’s top accountants and finance people to get its books into proper shape. So the new CFO need not worry about any nasty surprises.
