Finance Factories

Why are some companies better than others at producing CFOs?

“There is a competitive streak in me,” declares Nick Rose. “I was looking at the top of the pyramid from day one.”

That is how the finance chief of Diageo, a £10 billion (€12.6 billion) UK drinks group, describes the conviction that fueled his rise from the junior finance ranks at carmaker Ford in the early 1980s to more senior roles at Diageo, including the top finance post, which he reached in 1999. The climb up the corporate ladder to CFO — lasting nearly 20 years — involved frequent job rotations in a variety of countries and markets at both companies, giving him a “fantastic grounding in the art of finance.”

If aspiring CFOs could choose only two companies to have on their CVs, Ford and Diageo would be high on the list. Finance chiefs from some of the UK’s leading multinationals got their grounding at these companies, including ex-Ford man George Rose of BAE Systems and Diageo alumni Andrew Higginson of Tesco, Julian Heslop of GlaxoSmithKline and Ken Hanna of Cadbury Schweppes.

If the most valuable career lessons are learned on the job, Ford and Diageo should be considered two of Europe’s top “academy companies.” To identify other top incubators of financial talent, CFO Europe traced the career paths of 200 CFOs from the region’s largest listed firms. (See “Career Paths” at the end of this article.) Certain companies appear frequently on finance chiefs’ CVs. What’s their secret?

Recruitment experts agree that academy companies have several things in common: robust graduate training programmes for finance recruits; regular job rotations — generally at least every two years; foreign assignments; and clearly defined processes for identifying talent and succession planning. “Beyond that, you also need to have a very visionary CFO, who will take risks on individuals and get the business to accept rotation outside of finance,” says Laurent de Meeus, a partner in the London office of Egon Zehnder, a recruitment firm.

The Road to CFO

When Rose graduated from Oxford University, he wanted to work at Ford “because of the financial training that it had become known for.” In the ten years that he spent at the auto firm, he switched jobs every 12 to 18 months, gaining experience in planning, treasury, M&A, strategy, investor relations and other functions, in the UK as well as the US. Further promotions would have kept him in Detroit, but he was drawn to the UK for family reasons and so decided it was time to leave.

“There was a pace and directness in the American environment that I wanted to replicate back in the UK,” he says. In 1992, he joined food and drinks group Grand Metropolitan as treasurer, attracted by the company’s entrepreneurial spirit and lack of a rigid hierarchy. Regular job rotation resumed and, shortly after Grand Metropolitan’s 1997 merger with Guinness to form Diageo, Rose became CFO of the entire group.

Despite reaching the top, Rose hasn’t stopped thinking about career paths. “As a function, we take complete ownership of the development of finance people across the business,” he says. “We spend a huge amount of time rating and ranking the vast bulk of the finance department.”

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