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THE TIMES OF INDIA

C o m a p a n i e s offer t o p dollar to q u a l i t y CFOs

TNN| Apr 3, 2015, 06.52 AMIST
MUMBAI: W i t h a c h a n g e d regulatory e n v i r o n m e n t a n d intense competition, c o m p a n i e s are i n h o t pursuit for
quality CFOs. Executive search firms said t h e r e is a n urgency to fill s u c h posts w h i c h m a y have fallen vacant. T h e
resultant spike in d e m a n d has p u s h e d u p CFO salaries incrementally over t h e past few years. Usually, a CFO's
salary is a b o u t 30% of t h e CEO's compensation. B u t i t has risen incrementally to 33% i n 2011 a n d 34% 2012,
according to M o o r t h y K Uppaluri, CEO, Randstad India.

Earlier, corporates were r u n o n a steady state basis w i t h some growth p l a n n e d every year i n t h e i r regular
business. Increasingly, however, corporates are looking to grow exponentially a n d a t t i m e s i n n e w unrelated areas,
t r i g g e r i n g t h e n e e d to l o o k for alternative sources of f u n d i n g .
"In a d d i t i o n to banks a n d t h e traditional share markets, corporates have t h e o p t i o n of raising f u n d s f r o m a w h o l e
n e w set of organizations like PE firms, a n g e l investors, overseas l e n d i n g organizations a n d share markets. These
require a CFO of exceptional quality — b o t h intellectual as well as in communication a n d advocacy skills — w h i c h
is difficult to find," said Rajiv B u r m a n , m a n a g i n g partner, Lighthouse Partners.

T h e role of t h e CFO has, thus, u n d e r g o n e a n o v e r w h e l m i n g transformation. It's n o t m e r e l y a functional role of

m a n a g i n g books, cash flows a n d f u n d i n g . Today, t h e CFO has b e c o m e t h e co-driver of t h e business a l o n g w i t h
t h e CEO.
"Companies are replacing CFOs w h o are of t h e o l d school of t h o u g h t a n d m a i n l y of m a i n t e n a n c e nature. I n a
hyper-competitive e n v i r o n m e n t , companies w a n t t h e CFO to be proactive a n d n o t reactive, h e l p o n strategy a n d
expansion i n business. H e is t h e chief lieutenant today a n d a key ally. Previously, t h i s space w a s o c c u p i e d by sales
a n d m a r k e t i n g heads," s a i d R o n e s h Puri, M D , E x e c u t i v e Access India.
B u t naturally, i f a CFO quits, companies d o n ' t w a n t to leave t h e post vacant for long. Uppaluri said, "In case a
c o m p a n y is c a u g h t i n a situation where i t is required to fill a vacancy o n a n u r g e n t basis, we have i n t h e past
placed CFOs w i t h i n a matter of a c o u p l e of days."

At times, t h e r e are emergencies because a n M & A m i g h t b e i n t h e works o r t h e r e m a y b e requirement to raise

f u n d s immediately. Puri said, "Earlier, we w o u l d present candidates to companies after two m o n t h s of g e t t i n g a
search. This has come down to a b o u t a month."

O n d e m a n d o u t s t r i p p i n g t h e s u p p l y of CFOs, A r v i n d Agrawal, president - HR a n d corporate d e v e l o p m e n t , RPG

Enterprises, said t h e reason for t h i s is t h e lack of high-caliber talent. "There are m a n y qualified candidates b u t t h e
g o o d o n e s will always be i n greater d e m a n d . Also, m a n y candidates display s t r e n g t h i n either functional o r
leadership skills. B u t a g o o d CFO needs to have a combination of both," said Agrawal.

Globally, CFOs are rising to CEO positions. A popular example is Indra Nooyi of PepsiCo. At RPG, m a n y of its
b u s i n e s s h e a d s — a t K E C a n d R P G Cables, to n a m e a few — h a v e b e e n f o r m e r CFOs. T h i s h a s m a d e I n d i a ' s
f i n a n c e leaders most o p t i m i s t i c a b o u t growth i n e m p l o y m e n t c o m p a r e d to a n y o t h e r c o u n t r y covered. According
to a survey of global f i n a n c e leaders by American Express i n partnership w i t h CFO Research, 78% of f i n a n c e
leaders surveyed f r o m India expect to see s t r o n g g r o w t h i n e m p l o y m e n t opportunities as c o m p a r e d to 50% of
t h e senior f i n a n c e professionals from China a n d 61% from US w h o responded.