Good morning. This year, I’ve continued to delve into the evolving role of the CFO, which seems to become more dynamic by the day.
The debate over whether it’s more valuable to have a CPA or an MBA when aiming for a CFO position continues. Meanwhile, there is a high demand for CFOs who have finance or even investment banking backgrounds, coupled with experience in operations, leadership, and strategy. But that doesn’t mean companies aren’t seeking “reporting CFOs.”
That was the topic of a conversation I had this week with Shawn Cole, president and founding partner of executive search firm Cowen Partners. The term reporting CFOs refers to the traditional remit of finance chiefs, which is taking care of financial reporting and compliance within the company. These leaders have backgrounds in accounting and auditing, hold a CPA, or perhaps previously worked at a big accounting firm, for example, Cole said.
“Reporting CFOs are still in high demand right now,” he said. Depending on a company’s needs, some CEOs and boards may be focused on bringing financial stability to the firm or they may want to scale up quickly, he said.
But there’s no denying that broader business knowledge and operational experience is a requirement to become a “modern CFO” who is central to company strategy. However, those who also have accounting backgrounds could have the upper hand.
“The best CFO profile is the reporting CFO who became an operating CFO,” Cole said. For example, they have an accounting foundation, but acquired operational experience having helped run departments like IT, and have led M&A, he said.
I recently talked with Khozema Shipchandler, who became the CEO of the software company Twilio in January. He moved from CFO to chief operating officer to president to chief executive at the company in less than six years.
When he began as CFO, Shipchandler was intentional about getting operational experience. “I talked to my predecessor about it at the time and said, ‘There’s a lot more that I can do here besides just accounting and financial planning,’” he recalled.
For Cole’s clients who seek CFOs with operational experience over accounting experience, he reminds them of a critical factor—ensuring they have a great chief accounting officer (CAO) or controller in place or hire one.
The various accounting scandals we’ve seen this year also underscore the high value of an exceptional CAO or controller.
Sheryl Estrada
[email protected]
The following sections of CFO Daily were curated by Greg McKenna.
Leaderboard
Mark Hirschhorn, CFO at Amwell (NYSE: AMWL) a telehealth provider, will take on an expanded role as chief operating officer, effective Jan. 1. Hirschhorn will now oversee the company's operational and growth strategies, including the clinical, sales and marketing teams while continuing his responsibilities as CFO. Current Chief Operating Officer Kurt Knight will depart Amwell at the end of the year.
Giovanni Sapio was named CFO of Intelliguard, a provider of medication management systems. Sapio brings extensive experience in financial leadership, including roles at Cardinal Health, IBM, and Scotts Miracle-Gro. As CFO, Sapio will oversee the establishment and scaling of Intelliguard’s financial and operational infrastructure to support expansion while ensuring governance and regulatory compliance.
Big Deal
The Federal Reserve slashed interest rates by a quarter-point on Wednesday. The central bank’s outlook for 2025 came in more hawkish than expected, however, sending stocks lower and the dollar higher. Fed Chair Jerome Powell noted that the Federal Open Market Committee has lowered the federal funds rate, which now sits at 4.25-4.5% after three straight cuts, by a full percentage point since September.
“We can therefore be more cautious as we consider further adjustments to our policy rate,” he said during his press conference.
According to the Fed’s famous “dot plot,” the committee’s members are penciling in just two quarter-point cuts next year, down a full percentage point from their September chart. Bill Adams, chief economist at Comerica Bank, said the economic background would typically support more rate cuts in 2025. The election has complicated the Fed’s calculus, he said, as a second Trump administration appears poised to boost economic growth with tax cuts, raise prices with higher tariffs, and tighten the labor market with deportations and immigration restrictions.
“It's too early to know the timing or magnitude of these policy changes,” Adams wrote in a note Wednesday, “so it’s hard for the Fed to incorporate them into their decision-making right now.”
Going deeper
J.P. Morgan Wealth Management released its 2025 outlook report on Dec. 17. Five takeaways are the firm believes 2025 will be the year of easing global policy; accelerating capital investment; understanding election impacts; renewing portfolio resilience; and evolving investment landscapes.
For example, global monetary policy easing and accelerating capital investment, especially in AI, will likely power markets forward, according to J.P. Morgan.
Overheard
“Dots’ all folks.”
—BlackRock chief investment officer of global fixed income Rick Rieder said in a statement to Coins2Day referring to the Federal Reserve’s “dot plot,” and playing on the Warner Brothers cartoon ending, “That’s all folks!” The Fed’s “dot plot” on Wednesday projected a reduction in expected rate cuts from four to two in 2025. At a meeting in September, the Fed had previously projected four rate cuts next year. Rieder suggests it might be the end of the intense focus on the dot plot, Coins2Day reported.
