Leadership roles are proving to be exceptionally volatile, as a new study reveals CFO tenure is almost 14% shorter than the average across all C-suite roles.
The research, part of the ‘C-Suite Churn Report’ created by sharetech platform Vestd, finds that Chief Financial Officers experience an average tenure of 3 years and 10 months, compared to the overall average across all C-suite roles of 4 years and 5 months – a difference of 7 months.
CFOs also have a significantly shorter tenure at the business overall, at 8 years and 3 months compared to the C-suite’s total average of 9 years and 2 months.
The study comes as a recent report from management consultancy Russell Reynolds Associates found that CFOs were leaving at the fastest rate in six years.
With the significant cost of rehiring, difficulty sourcing executive talent and the impact an empty seat in the boardroom has on the business’ overall strategy, this rise in resignations gives business leaders ample cause for concern.
Why is CFO churn rising?
Ifty Nasir, founder and CEO of Vestd, believes there’s a mixture of factors behind the rise in CFO departures. He said:
“Supply chain disruptions, shifts in the global market and regulatory challenges are just a handful of the challenges today’s CFOs are facing.
“There’s also increased volatility across the wider C-suite. January 2025 saw a record number of CEO resignations. And high turnover among CEOs can heavily influence CFO departures, either through the ‘domino’ effect or when the incoming chief exec has a different vision for the company and management team.”
AI brings opportunity, but also challenges
AI adoption has risen rapidly, with some 72% of finance organisations now using artificial intelligence – more than double the figure for the previous year (34%).
But while AI offers plenty of benefits, it’s not all smooth sailing from the CFO perspective. Ifty said:
“AI can help finance leaders become both more efficient and resilient, with better planning and forecasting processes that can help firms stay ahead of external shocks like policy and tariff changes.
“However, these rapid technological developments put extra pressure on the CFO. Not only are they responsible for quickly understanding new solutions, but also overseeing a successful implementation. Plus, there’s the return on investment to prove, which can be challenging where benefits are harder to quantify or the data is difficult to collect.”
Putting employee wellbeing at the centre
Further digging into the ‘why’ behind the rise in resignations reveals that job satisfaction is a persistent issue across the C-suite.
In fact, one Deloitte survey previously found that some 75% of C-suite respondents said they were seriously considering quitting their current job for one that supports their wellbeing at a higher level.
Ifty added:
“Burnout is becoming increasingly common. More than three-quarters of UK CEOs feel overworked.
“The growing pressure of the CFO role means that prioritising a good work environment is more important than ever. That includes things like prioritising a healthy work-life balance, taking holidays, and minimising extra working beyond regular hours.”
Give leaders a reason to stay
Ifty also discussed the importance of incentives to retain top talent. He said:
“Giving CFOs a stake in the company or ‘skin in the game’ can go a long way in securing their commitment long-term and motivating them to help drive business growth.
“One effective option for this is growth shares. Here, recipients are provided with a share in the future capital growth of the business, rather than its current valuation: a powerful counterbalance to short-term business pressures and bonuses.
“Growth shares can also be set with customised triggering conditions – like hitting a revenue goal or staying with a company for a set period of time. This gives a clear goal of exactly when recipients will actually get access to their shares, and can help tackle shortening CFO tenures by encouraging leaders to stay for the long haul.”
Rising CFO turnover is more than just a leadership issue – it’s a strategic vulnerability.
To truly thrive in today’s fast-moving economy, businesses need to take a proactive approach to the elements they can control. Making use of the benefits technology can offer, prioritising executive wellbeing and incentivising leaders to stay can help companies foster stronger, happier teams that are built to last.
