Equity Analysts Focus on CFOs Rather than CEOs

by Erin McCune on June 10, 2008

in Careers, Financial Reporting, Investment Strategy, Management, Research Round Up

Are CFOs ready for the spotlight? According to CFO.com research from Greenwich Associates reveals that for the first time an annual survey of Wall Street equity analysts ranked the credibility of a company's finance chief as more important to the overall IR effort than that of the chief executive.

But it was the endorsement of the CFO's that captured the most attention in the report. "In a slowing economy, analyst focus shifts from broad questions of strategic positioning relative to future growth potential to nuts-and-bolts measures of cash flows and financial health," said Greenwich Associates consultant Bill Bruno. As a result, he says the firm is recommending that clients to make sure "their CFOs are ready for the spotlight."

Said Bruno, "Analysts today are often much more interested in questioning and judging the capability of the CFO than in talking to the CEO. But many CFOs have backgrounds in accounting or finance as opposed to sales, and many have not received the same type of speaking and presentation training common among CEOs. Our data suggest that, outside of ensuring transparency in our accounting, one of the best things you can do to buttress your IR effort is to get your CFO some good communications training."

Analysts Now Turn First to the CFO, Not CEO
Stephen Taub
CFO.com, US
June 9, 2008

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