New Perspectives

Forward-looking finance executives can benefit from a past in investor relations.

Kevin Entricken has enjoyed an eventful finance career. In the early 2000s, he oversaw M&A deals as vice president of finance at a division of Anglo-Dutch publisher, Reed Elsevier. More recently, he handled a restructuring as CFO of Dutch media group Wolters Kluwer’s law and business arm. Then, last summer, he gave up his job.

What kind of role is tempting enough to lure a successful CFO away from finance? In Entricken’s case, one in investor relations (IR). When Wolters Kluwer offered him a job as vice president of IR, he jumped at the chance to gain “a more outward-looking perspective” on the €3.4 billion company, its strategy and its investors. After a year in the post, he has no regrets. “I would recommend to anybody in a financial field a stint in investor relations,” he says.

Entricken believes his finance background gave him insight into the company and its markets that allowed him “a headstart on the learning curve” in IR. He’s not the first executive to benefit from exposure to both departments. Some CFOs started their career in IR before heading into finance. Others have complemented their finance skills by spending time in or overseeing IR departments.

In fact, Entricken doesn’t rule out returning to the finance fold. If he does come back, he could be better placed than before to handle a CFO post, say experts. In June, consultancy Greenwich Associates asked around 700 equity analysts across the US about IR. Some 80% said that the finance chief’s credibility is “essential” to a company’s IR strategy, compared with about 75% when Greenwich carried out the same study a year ago. As economic conditions force analysts to focus even more on a company’s financials, CFOs with IR experience will find that this is their time to shine.

Make Me Better

Finance executives who have made the transition to IR often see it as a natural move. Six years ago, Isabel Goiri took over as head of investor relations at BBVA, a banking group headquartered in Spain with profits of €5.4 billion. She saw it not as a quantum leap for her career, but an extension of her previous work as an equity analyst and portfolio manager. “To be cutting edge in IR today, you need to be financially savvy,” Goiri says. Her knowledge of portfolio managers’ likes, dislikes and preferred metrics helped her “make the function more strategic,” she adds, as she consulted with BBVA’s CFO on the company’s plans, M&A opportunities and how the market would view various decisions the board was taking.

Now Goiri is back in finance, right at the top. In January she became CFO of Compass, a US bank BBVA bought in 2007 for €6.7 billion, after its previous CFO was promoted to the chief executive post. Her task over the coming months will be to help oversee the integration of Compass with three other BBVA-owned banks in the US. And just as she used her finance skills in IR, now she’s relying on her time in IR to boost her CFO knowhow. “Has being head of IR helped me to be a better CFO? I’d say a very clear yes,” she says.

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