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How Can You Achieve Your Goal of Becoming CFO?

Those aspiring to be CFOs can benefit from holding a variety of positions, sin

After moving through the ranks of a company and gathering valuable experience, many finance professionals wonder how they can successfully make the leap and become a CFO. Proformative members ask this question on a regular basis on the Ask & Share section of the site.

While every finance executive has a different background, level of experience and skill set, there are common qualifications many believe can make an individual successful in a CFO role. 

The MBA vs. CPA Quandary?
Those on the CFO track debate whether they need an MBA or a CPA to prove their qualifications. But the answer to which training to get depends on the type of CFO they want to be and the best fit for their personality and natural skills. The answer is not simple, as Proformative members have found time and again when they discuss the issue among their peers.

While CPA backgrounds are often preferred by those who hire and promote CFOs, MBA degrees are common among some of the most talked-about and successful finance chiefs of today. Karen Hoguet, who has served as the CFO of department store Macy's since 1997, received an MBA before securing her executive finance role, as did Mark Loughridge, who has led IBM's finances since 2004. However, according to research from Russell Reynolds Associates, only 54 percent of Fortune 100 CFOs have an MBA, and only half of those received their degree from a top business school.

The number of CFOs who are CPAs is higher, according to the 2012 Financial Executive Compensation survey released by Grant Thornton. The research revealed 71 percent of public company CFOs and 67 percent of those who work at a privately held firms are CPAs. Several Proformative members have voiced the opinion that a CPA is becoming more of a necessity, especially with regulations like those from the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act putting demands on businesses to better protect operations from additional risk and noncompliance. In fact, the instances of CFOs who have CPAs significantly rose after Sarbox's passing, increasing the chances that controllers could gain the top spot over treasurers.

No Right Career Path for Those Seeking a CFO Role
Since the role of the CFO varies between companies, in terms of how much involvement they have with departments outside finance, how much interaction they have with the CEO and the board, and how much impact they will have on the business strategy, there is no set background any CFO must have. "I think the best CFOs are the ones who get the numbers/understand the accounting, but have the 60K view of the business and can partner with management," JDS Uniphase CFO Rex Jackson wrote during a recent discussion on Proformative.

Many Proformative members advise aspiring CFOs to take on the role of controller, as the position can help an individual move up within a firm or provide valuable experience for someone looking for a CFO role with another business in the future.

Working as financial planning and analysis manager or treasurer can also help financial professionals achieve their ultimate goal of becoming an executive.

For those who seek a role at a major corporation, starting off as the CFO of a smaller firm and slowly working up may prove to be an effective stepping stone. It may be easier to achieve the top spot at a smaller organization, and many Proformative members agree it's much more difficult to obtain a CFO position at a large business without having held the title at another firm first.

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