The Chief Executive Officer (CEO) or Managing Director manages the operations and resources of a business while making major corporate decisions.
Sitting on top of the company ladder, perhaps without any non-executive directors or even an active Board, CEOs can feel unsupported in their role. Even with an active Board in situ, these are often solely reporting structures rather than supportive structures.
Business owners, in particular, can feel isolated, with the heavy responsibility of running the day to day operations, having to make sometimes difficult decisions that can dramatically affect the lives of their workforce, without reference to anyone that understands the pressures that being ‘top dog’ brings.
Some business owners solve the problem by bringing in an Experienced Finance Director (EFD) who can mentor the CEO and act as a sounding board on whom they can bounce their problems and ideas. Often the unsung heroes of company boardrooms, EFDs are needed more than ever to help CEOs steer their businesses through these uncertain times.
CEO mental health
Research exploring the topic found that the cliché is true; it is lonely at the top. A survey conducted by the Harvard Business Review found that half of the CEOs interviewed expressed feelings of loneliness, with 61% adding that this isolation adversely impacts their performance. Being at the top of the hierarchy, the CEO is the highest-ranking executive and essentially has no peers, only employees. As a result, CEOs have a substantial amount of pressure to deal with and nobody to confide in.
Studies have proven that these feelings negatively affect how the brain operates, often leading to poor sleep, stress, and the development of detrimental coping mechanisms such as drinking. Further, it can be devastating to their personal lives with many previously happy relationships falling apart as the pressures of work take their toll.
An experienced finance director can help
EFDs are often brought into businesses and quickly form a strong bond with the CEO. Specialising in challenging and supporting CEOs in making strategic decisions, an EFD carries the business acumen needed to partner with a CEO and help them steer their business in the right direction. Working alongside numerous CEOs in the past, EFDs understand their challenges and specialise in developing solutions tailored to their business. With their extensive experience in dynamic roles, good EFDs will be both open minded and also have “been there and done that”, making them trusted supporters for CEOs to confide in.
The relationship between the CEO and EFD
Immersing themselves in a business, the EFD will spend much of their time supporting the CEO. The bedrock for this relationship is trust and respect, and the recognition that they are working towards a shared goal. The EFD must demonstrate a balance of loyalty to the CEO while also being comfortable to challenge them when required. The CEO must be prepared to accept constructive suggestions from the EFD, who will have a deep understanding of the company’s financial performance and the ability to create and execute impactful business strategies.
CEOs view EFDs as indispensable in the boardroom because of their commercial and strategic awareness as much as their financial prowess, and they often expect them to:
- Act as a second in command
- Manage relationships with key operational managers, investors and banks
- Make recommendations to support the development of corporate strategy across all departments of the business
- Challenge decisions when financial data does not support them
Why partner with Dartcell?
As a CEO, you need support from an EFD whose bread and butter is working alongside business owners to create and execute top-level strategic decisions. A Dartcell EFD is an asset to any CEO, providing regular recommendations, unique insights and support formally at board meetings and informally on a day to day basis. Your dedicated EFD will work alongside you to ensure that you do not carry the weight of running your business alone. With an affinity for the numbers and strong commercial acumen, they will interpret your financial data and help you make better decisions to achieve your vision for your business.
If you would like to partner with a Dartcell EFD and improve your company’s performance, please contact us.