Private equity-backed businesses are facing an increasing number of challenges as they look to hire and retain top-tier finance talent: those reporting directly to the CFO, including Finance Directors, Managers, Controllers and FP&A leaders. While competitive compensation remains crucial, other factors have emerged as decisive in attracting and keeping the best professionals in this space.
In today’s market, the level of mentorship, exposure and value given to CFO-1 talent directly impacts the future supply of CFOs. Those who gain firsthand experience in scaling businesses, managing investor relations, and with a front row seat to an exit are far better equipped to step into CFO roles and hit the ground running in PE-backed environments.
Below, we explore five trends shaping the market and what businesses must consider when hiring CFO-1 talent, as well as how businesses can look to futureproof their hiring plans.
1. Equity matters more than ever
Historically, strong cash compensation was the primary driver for attracting finance professionals that report to the CFO. However, over the past few years, there has been a clear shift: equity has become a critical factor. More candidates are prioritizing long-term value creation, aligning their interests with business performance and ownership.
For companies competing for leading finance talent, a well-structured equity offering is now a fundamental component of an attractive package. Without it, businesses risk losing out on the best candidates to competitors offering meaningful participation in the upside.
2. Flexibility is no longer optional
While many businesses are eager to bring employees back into the office, we often see that top finance talent is securing greater flexibility. It is now rare to see leading candidates committing to four or five days a week in the office. Instead, they expect a hybrid approach that allows them to balance in-person collaboration with the efficiency of remote work.
The best professionals understand when they need to be in the office and with whom they need to meet to build key relationships. Companies that enforce rigid in-office policies may struggle to attract and retain top talent, particularly when competitors offer more adaptable working models.
3. Investor exposure appeals
For many senior finance professionals, the long-term career goal is to become a CFO. To reach that level, they recognize the need to develop a strong understanding of investor relations, key financial metrics, and strategic decision-making.
Top candidates actively seek exposure to private equity investors, board-level reporting, and key strategic areas such as FP&A and M&A. Hands-on experience with investor communications, board pack preparation, and understanding the metrics that drive business performance can be a big draw.
Businesses that offer structured mentorship and direct interaction with investors will be far better positioned to develop future CFOs who are ready to step into leadership roles in high-growth, PE-backed environments.
4. Salaries have soared
Salaries for top CFO-1 professionals have seen a significant increase, rising by approximately 20% compared to two to three years ago in the US. Indeed our own data supports this: we track annual compensation across our significant database and have been reporting on trends in the industry for the last eight years. Several factors are driving this:
- Increased demand for top-tier finance talent, particularly in private equity-backed businesses.
- The rising importance of financial leadership in navigating economic uncertainty.
- The need for more sophisticated FP&A capabilities as businesses focus on data-driven decision-making.
Companies must recognize that competing on salary alone is becoming increasingly difficult. A combination of competitive compensation, equity incentives, flexibility, and career development opportunities is now required to secure and retain the best talent.
5. Broader skill set expectations
The role of CFO-1 professionals is evolving beyond traditional financial reporting. They are now expected to be more commercially minded, acting as strategic partners to the CFO and contributing to business growth and operational efficiency. One of the key skills needed to succeed, as established at a breakfast panel we ran recently is the need to effectively communicate – articulating complex financial information into an easily comprehensible format and to deliver news unambiguously.
Particularly in PE-backed businesses, the ability to interpret data, forecast with precision, and provide real-time insights is now a key differentiator. Those who develop these skills will have a significant advantage when stepping up to CFO.
Building success for future leaders
The CFO hiring market remains highly competitive, and businesses must proactively develop the next generation of finance leaders. The more value, mentorship, and exposure CFO-1 professionals receive today, the greater the future supply of CFOs who:
- Have seen scale and hypergrowth first-hand
- Understand how to communicate with investors and manage board expectations
- Have been through an exit or major liquidity event
- Can hit the ground running in a PE-backed environment
Companies that prioritize developing CFO-1 talent will not only improve retention at this level but also create a sustainable leadership pipeline, ensuring they have access to proven finance leaders ready to step into CFO roles when needed.
If you’re looking for your next challenge in a finance role, or looking to grow your team, please get in touch.
Written by Managing Director Mark Sattin.
