The C-Suite title that’s rapidly gaining power, and gender balance

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When Deanna Strable was first offered the chief financial officer spot at Principal Financial — a company she spent her entire career at — she turned it down. She was the head of the firm's entire U.S. insurance business, and she said she liked it that way.?

If she became CFO, she thought, she’d be taken out of the important conversations on how to keep the business growing. But the CEO and board of Principal had other designs for the CFO role, and Strable came around to the idea.?

“They said they wanted a strategic CFO, not a traditional CFO,” said Strable, who has now been CFO for Principal for nearly five years. “They wanted someone who would influence the numbers, not just report them out.”?

The “strategic CFO” that Principal was seeking is now commonplace across corporate America. Many think of the CFO as the person responsible for sharing quarterly reports with investors and ensuring the company stays within budget, but this view is outdated.?

As businesses move faster and faster to stay competitive, CFOs have become essential players in guiding company decisions and strategy. In many companies, the CFO is now considered the right-hand to the CEO.?

This shift has pushed women like Strable to enter the C-Suite via this highly coveted role. Some 34% of CFOs on LinkedIn are female, according to an analysis of LinkedIn Talent Insights. That’s a greater share of women than most C-Suite roles. And in 2020, women accounted for a record high of 18% of Fortune 500 CFOs, according to Bloomberg.?

Jennifer Biry has been CFO at WarnerMedia since December 2020. She was the first person in her family to go to college, and she did not have aspirations for a career in finance. But a professor told her early on that she had a knack for numbers and that she should consider accounting. She didn’t like accounting very much, but she enjoyed the strategic thinking that came from a deep understanding of the numbers.

That curiosity led her to the CFO role.

“I spend very little of my time on the specific numbers,” she said. “I spend a lot of time shaping the news and thinking about the investments that we need to make for the next generation of our leaders.”

Given the rising importance of the CFO, many hope that the growing pipeline of women CFOs may ultimately fuel a growing pipeline of female CEOs. Some companies are even eliminating their chief operating officers and giving those operational responsibilities to the CFO, making them prime candidates to move into the top spot.?

Indra Nooyi was CFO of PepsiCo before taking over as CEO in 2006. When she joined the beverage giant in 1994, there wasn’t a single female CEO in the Fortune 500. She says her experience as CFO gave her the preparation she needed to run the whole company.

“You’ve got to know the business in all details and levels,” she said. “This person has to [speak to Wall] Street, which positions the company in the investor’s minds in a very different way than just accounting.”?

The rise of women CFOs has already fueled an uptick in female board directors, said Jana Rich, the founder and CEO of executive search firm Rich Talent Group. Rich said she is getting requests for female CFOs “left, right and center” for audit committees — a subset of the board that oversees a company’s financial statements and reporting.?

The challenge, Rich says, is trying to place current CFOs into public boards. Companies are often looking for retired talent to serve on boards, but many of these sought-after executives are already “overboarded” themselves.

Nooyi, who retired from PepsiCo in 2019, now sits on the boards of Amazon, Philips and the Partnership for Public Service.

While a growing share of women are considering careers in finance and accounting, Strable and others maintain that more needs to be done to achieve gender parity in this space. CFOs are expected to report earnings on a quarterly basis. It’s a time-sensitive — and intensive — process that Strable says pushes many women away.

Thinking about the next generation, Strable mentioned that her 21-year-old daughter was the only girl in her school’s advanced math program when she was a fourth grader. Getting young women like her to see how finance has changed could translate to a more diverse C-Suite moving forward.?

“They see the people in the CFO role and they don’t see themselves,” Strable said. “But I have always been a big believer that strategy, finance and execution have to come together in tandem.”

What’s Working

Record high. 41% of incoming students across 55 U.S. business schools are women, according to research by the Forté Foundation. An MBA is one of the most lucrative advanced degrees, and so increased enrollment could also help close the gender pay gap. [Fortune]

Equal pay has a say. New research suggests that companies who share publicly that they have a gender pay gap amongst their ranks leads to backlash from consumers. Rather than avoid the disclosure, companies should craft open and honest communication plans once the announcement is made. [HBR]

Made, not born. While the conversation on paid family leave has focused almost exclusively on mothers, research suggests that we need to bring fathers into the conversation as well. Fathers?who take even just a week off of leave after their children are born report closer relationships with their children nine years later, showcasing that time with infants is “a key ingredient in building the fathering brain.” [NYTimes]

What’s Not

Losing ground. A series of four surveys about emotional and economic well-being found that LGBTQ respondents reported higher levels of food insecurity, anxiety and depression than their non-LGBTQ counterparts. U.S. unemployment and income stats don’t measure the LGBTQ experience. [Bloomberg]

Service worker stress. The pandemic has had an outsized impact on frontline workers, and by most measures their wellbeing is worse now than it was before the pandemic. Empower Work, a nonprofit that provides a free and confidential text line for work issues, provides solutions employers and policymakers alike can implement now to lessen the issue. [LinkedIn]

Another crypto miss. Over the last 21 months, female artists accounted for just 5% of all NFT art sales. At a recent NFT conference, only 18% of speakers were female and just 30% of sponsors. [Bloomberg]

Who’s Pushing Us Forward?

How can we better support the career paths of female veterans after they leave service? I spoke with two experts who shared their career journeys and solutions moving forward. Check it out above.?

What topics do you want to discuss next time? Let me know in the comments below using #WorkingTogether