Good morning.
In my talks with CFOs, many tell me how it’s increasingly important for them to understand the operations and inner workings of their company to boost efficiency and growth.
“I consider the role of the CFO much more operational than just the finance department,” Moderna CFO Jamey Mock told me last week. “I spend as much time with our manufacturing teams, our commercial teams, our research and development teams, and the rest of the functions.”
“Companies have recognized that some of what used to be managed by a COO [chief operating officer] has drifted into the CFO’s purview,” says Clem Johnson, the president of Crist Kolder Associates, an executive search firm. Some organizations are choosing to give the “dual title of CFO and COO, or president and CFO in some cases,” Johnson says. “When we are conducting a search, the casual term used is often ‘CFO plus.'”
Jenna Fisher, managing director and head of the CFO practice at the global firm Russell Reynolds Associates (RRA), shares what she’s seeing. “Many CFOs are the de facto COO, even without that title,” Fisher says. “Every company’s definition of what a COO does varies. It really depends on the industry—with manufacturing companies being more likely to have a COO.”
Currently, just 1% of S&P 500 and Fortune 1000 companies have CFOs with the dual title of CFO/COO, according to RRA. But the COO role itself, which has gone in and out of popularity over the years, is on the rise again.
RRA data shows that 39% of S&P 500 companies have a COO. That’s down from 48% in 2000. However, it’s up from 32% in 2018. And 42% of Fortune 1000 companies have a COO. With the increase in popularity, we may see more CFOs with the dual title soon, according to RRA.
Finance chiefs who have added COO to their title this year include Block CFO Amrita Ahuja; Macy’s CFO Adrian Mitchell; Abercrombie & Fitch Co. CFO Scott D. Lipesky; and The Children’s Place CFO Sheamus Toal. And other executives joined a company for a CFO/COO role such as Ketchum’s Conor Nash and Sendero Wealth Management’s Kristina G. Craig.
In a recent LinkedIn post, Mitchell wrote about taking on the COO at Macy’s. In addition to leading finance and real estate functions, he now oversees stores, supply chain and technology. “My new responsibilities allow me to go deeper into the design and execution of our long-term goals,” he writes. “From an operations perspective, we are exploring how we can build a faster, more flexible and more efficient operating model that will better serve our customers.”
“COOs are making a comeback” and the role is “bigger, bolder, and more transformative than ever,” recent McKinsey research finds. The role has traditionally “taken a backseat to other C-suite functions” and “its recent resurgence and increasing visibility showcase the importance of the job in building resilience,” according to McKinsey.
Being appointed COO may also be a test for the top job.
“The COO role can be a stepping stone on the way to CEO,” Fisher says. “So, some companies will put someone in that spot if they see potential for them to ascend into the CEO role in time.”
Sheryl Estrada
sheryl.estrada@fortune.com
Leaderboard
Scott LeTourneau was named EVP and CFO at Cox Automotive, effective Sept. 19. Current CFO Mark Bowser will retire at the end of this year. Bowser had an 11-year run at Cox Communications and six years as finance chief for Cox Automotive. He and LeTourneau will work together for the next four months during a transition period. LeTourneau has been with Cox since 2012 in various corporate development roles, most recently serving as SVP of corporate development for parent company Cox Enterprises. Before Cox Enterprises, LeTourneau served as VP of corporate development for Cox Communications. Prior to joining Cox, he served as the VP of corporate development for PGi, an equity analyst for Priderock Management.
Bradley T. Camden was named interim CFO at Kemper Corporation (NYSE: KMPR), an insurance provider, effective immediately. Camden replaces James J. McKinney, who will serve as a senior advisor to the company for a transition period. Camden most recently served as SVP and treasurer. He joined Kemper in 2020 as treasurer and has since led many of the company’s critical strategic initiatives, including the formation of Kemper Bermuda Ltd. and the Kemper Reciprocal exchange. Before Kemper, Camden spent 15 years at Northern Trust Asset Management, where he served in several finance leadership roles.
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Big deal
Shares of Arm Holdings, the semiconductor designer owned by SoftBank Group, opened Thursday at $56.10 on the Nasdaq, up $5.10 from its IPO price of $51, and closed at $63.59, a gain of $12.59, Fortune reported. Ranked by total gross proceeds, this makes Arm the third-largest IPO of a US-listed technology, media and telecommunications company on record, according to S&P Global Market Intelligence data. This is behind Meta Platforms Inc. and ride-hailing company Uber Technologies Inc.
Courtesy of S&P Global Market Intelligence
Going deeper
"What Our Brain Activity Reveals About Improving Workplace Culture," a new report in Wharton's business journal, discusses the results of a collaboration between the Wharton Neuroscience Initiative and consulting firm Slalom to measure the brain activity of employees to uncover what works best at work.
Overheard
“There are enough risks that I don’t think we should declare victory yet on our soft landing call."
—Jay Hatfield, CEO of Infrastructure Capital Management, told Fortune regarding the U.S. economy. Hatfield has argued for more than a year that the economy will avoid a recession. However, he notes that the risk of another regional banking crisis, spillover from Europe’s recession into the U.S., or an overly aggressive Fed means it’s too soon to say the economy is safe, Fortune reported.
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