Chief financial officer turnover in the Asia Pacific region decreased by 24% year over year in 2024, according to a report by Russell Reynolds Associates.
The Global CFO Turnover Report found that with roughly two-thirds of Asian-listed companies being family-controlled/owned, CFO turnover is unsurprisingly lower than the global average, as companies prioritise stability.
This causes a longer time to identify or groom a replacement, as companies need to build strong internal networks and trust with key family members.
The study, which looked into incoming and outgoing CFOs from 13 global indices, across various metrics such as tenure, industry, and whether the outgoing/incoming CEOs are internal/external hires, their genders, and if they are first-time or experienced CFOs, reveals that 67% of newly appointed CFOs in Asia Pacific were first timers, higher than the percentage of first timer CFOs appointed globally, at 60%.
Moreover, it was found that more companies preferred to appoint an internal candidate as CFO, indicating companies’ conservative approach to appointing a CFO familiar with the company, instead of hiring externally.
The report further states that across Asia Pacific, CFOs are lasting shorter than their global counterparts, with an average outgoing CFO tenure of 4.7 years. This shows that it is imperative that boards plan ahead for succession, in order to future proof their organisations amid market volatility.
