The CFO Exodus: Exploring Financial Officer Turnover in Europe

As European organizations navigate tumultuous macroeconomic trends, CFO retirements hit a four-year high, and turnover rates continue to increase, experienced financial leaders are few and far between. This poses significant risk to organizations looking to retain their CFOs in an increasingly competitive market.

Russell Reynolds Associates analyzed CFOs of European organizations from 2020 to 2023 (N=660) to summarize the latest turnover trends and gain insight into an increasingly competitive market where 60% percent have turned over since 2020. We found that:

1.) CFO turnover continues to increase across the board, with a four-year high in the FTSE 350, DAX, and the Euronext 100 
2.) The majority of newly appointed CFOs (57%) are in the role for the first time
3.) More women CFOs are coming from outside the organization (67%), as internal talent is scarce
4.) CFO retirement rates have sharply increased over the past four years, jumping 14 percentage points since 2022

The revolving CFO door: CFO turnover continues to increase across the board

In 2023, European CFO turnover hit 17%, reaching a four-year high (Figure 1). Recent high levels of CFO turnover suggest that this trend may become the norm, due to increasing retirement rates, macroeconomic trends, and the fight for financial officer gender diversity. This continuous churn creates new opportunities for next-generation finance talent, and is likely why the majority of newly appointed CFOs are in the role for the first time (we’ll explore this further in the next section).

Figure 1. Trending CFO turnover: 2020-2023

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023 N=660.
Note: 15 of the new CFOs are interim. Some companies are multi-listed; turnover is accounted for across all indexes.}

The FTSE 350 & DAX 40 have been particularly active, with CFO turnover in 2023 reaching a four-year high of 17% and 25% respectively, while the Nordic regions have seen a decrease in the same period of time (Figure 2). The increase in turnover can be partly explained by unprecedented retirement rates for CFOs across Europe, coupled with an increased demand for experienced CFOs.

Figure 2. Trending CFO turnover by index

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: 15 of the new CFOs are interim. Some companies are multi-listed; turnover is accounted for across all indexes.}

The majority of newly appointed CFOs are in the role for the first time

There continues to be more first time CFOs in the European market (57%), likely due to the record levels of CFOs retiring in 2023 and CFO succession plans coming to fruition. However, organizations that look externally for their next CFO are opting for proven talent (Figure 3), likely wanting the stability of someone who has held the top job as we continue to navigate through economic uncertainty.

Figure 3. Internal versus external CFO appointments

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: 15 of the new CFOs are interim. Some companies are multi-listed; turnover is accounted for across all indexes.}

Women CFOs are coming from outside the organization, as internal talent is scarce

More women have been appointed to the top financial job than ever before, as women now hold 19% of CFO roles in the analyzed European indices. While these improvements are encouraging, we’re still far from parity, with 2023 CFO women appointments decreasing 7 percentage points since last year (Figure 4).

Figure 4. New women CFO appointments

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: 15 of the new CFOs are interim. Some companies are multi-listed; turnover is accounted for across all indexes.}

Organizations without a gender-diverse bench are looking externally for more talent, typically recruiting experienced women CFOs. In fact, in 2023, 57% of appointed women CFO appointments were sitting CFOs prior (Figure 5a), increasing 19 percentage points from the previous year. These external hires indicate that internal financial officers' pipelines—while improving at lower levels—still lack gender diversity at the top.

Figure 5a. Internal versus external women CFO appointments

Figure 5b. Women CFO experience

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: 15 of the new CFOs are interim. Some companies are multi-listed; turnover is accounted for across all indexes.}

CFO retirement rates have sharply increased over the past four years

Retirement rates reached a four-year high, increasing 14 percentage points to 60% in 2023 (Figure 6). On average, CFOs are retiring at age 57. CFOs approaching retirement may not seek another CFO role due to factors like burnout, financial security, or simply deciding that retirement seems the more attractive option. Instead, many are leveraging their finance expertise in various board roles, especially in the UK where there are more opportunities and demand for CFOs to transition into chair positions (21% of current FTSE 350 Chairs have CFO experience).

Figure 6. Trending CFO Departures

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: Some retiring/departing CFO data is unavailable}

As many CFOs retire and demand for experienced CFO talent continues to increase, there are ample opportunities for financial officers. Of the 67% of CFOs who made external moves, 100% have opted for a CFO role. Perhaps unsurprisingly, those who made internal moves all opted for broader, non-finance leadership roles, like CEO or COO (Figures 7 and 8). We have also seen a 38% increase in transitioning CFOs taking on a new CFO role, from 21 in 2022 to 29 in 2023 (Figure 8). With the current economic and political headwinds organizations are facing in Europe, organizations are looking for seasoned CFOs to help navigate.

Figure 7. 2023 European CFO Exits

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: Some retiring/departing CFO data is unavailable}

Figure 8. Number of departing European CFOs per new role

_{Source: RRA analysis of the FTSE 350, BEL-20, CAC 40, DAX, IBEX 35, OMX Helsinki, OMX Stockholm, SMI, Euronext 100 from 2020 to 2023, N=660
Note: Some retiring/departing CFO data is unavailable}

Authors

Romain Clio co-leads Russell Reynolds Associates' EMEA Financial Officers Practice. He is based in Brussels.
Ben Jones co-leads Russell Reynolds Associates' EMEA Financial Officers Practice. He is based in London.
Mohammed Khan is a member of the Financial Officers Practice knowledge team at Russell Reynolds Associates. He is based in London.
Catherine Schroeder leads Knowledge for Russell Reynolds Associates’ Financial Officers Practice. She is based in Toronto.
Suzzane Wood is a member of the EMEA Financial Officers Practice at Russell Reynolds Associates. She is based in London.