When Dick Cheney proclaims on Larry King Live that the nation’s Vice Presidency is a “weird duck” — for its combination of ceremonial and serious duties — what kind of bird does that make its corporate equivalent, the vice chairmanship? As it turns out, it’s becoming a more common species, and one that often brings more responsibility for CFOs.
Take EMC Corp.’s Bill Teuber. Since he joined the Hopkinton, Massachusetts-based storage giant a decade ago, his job has grown from managing the finance function to serving as CEO Joe Tucci’s operational right-hand man. So Teuber considered his promotion to vice chairman last year “a natural succession,” he says. “We had talked about it in the past and I was very pleased when it came through.”
Teuber, who was succeeded as CFO by David Goulden, now oversees everything from business development to customer relations to acquisition strategies to worldwide sales and distribution. That makes him the clear No. 2 at a company with $11.2 billion in annual revenue. “The title allows me to walk into any meeting as one of the most senior people at the company,” says Teuber, who now routinely fills in for the CEO in speaking engagements and board interactions. “My job is to make his job easier by helping him manage the company.”
Vice Chair of What?
Other former and current CFOs in vice-chair roles include Dell Computer’s Donald Carty, Wal-Mart’s John Menzer, and Pfizer’s David Shedlarz. In July, General Electric added the title for CFO Keith Sherin — extending its tradition of CFO/vice-chair combinations that includes the elevation of longtime CFO Dennis Dammerman to the post 10 years ago. (In that case, Dammerman shifted from CFO to CEO of the GE Capital Services unit, making way for Sherin to become corporate CFO.) “These individuals clearly have more responsibility outside finance, covering operations and strategy,” says Chuck Eldridge, co-managing director of Korn/Ferry International’s financial-officers sector. So when Eldridge sees a CFO add the vice-chair title, he regards it as an acknowledgment of the extra work that CFOs are taking on, especially at a time when there are fewer chief operating officers at companies.
Others aren’t always sure how to regard it. A sense of puzzlement can surround the title, leaving people to ask, for example, “Vice chair of what?” Only a few CFOs-turned-vice-chairs, after all, actually serve on the board. At some companies, vice chairmanships are largely honorary titles or simply serve as a consolation prize for being passed over for the top job.
“The title is nicely ambiguous; companies can use it differently in different circumstances,” says Jim Lawrence, vice chairman and CFO of General Mills. Named vice chairman when Kenneth Powell became president and COO — and the likely successor to CEO Steve Sanger — Lawrence saw his new title as recognition of his six years of responsibility for all of the company’s international business. “It was nicely dealt with,” he adds.