32. Transitioning from CFO to CEO - A Board's Perspective with Patrick Dunne

32. Transitioning from CFO to CEO - A Board's Perspective with Patrick Dunne

Hannah Munro: 0:48

Hello everybody and welcome to this episode of CFO 4.0. I am your host Han Monroe and today we have a returnee guest, Patrick Dunn. Now for those of you that remember, Patrick came on to talk about what boards are looking for from CFOs. He's the author of the boards, of boards, the book, and he's the leading authority in boards generally to be fair and is part of the Financial Times board directors program. Now today we're actually going to take a slightly different tack and I'm inviting back him back on because we had such great feedback from our last session and we were keen to continue the conversation. So, we are going to talk today about that transition from CFO to CEO from a board's perspective and we're going to obviously dig into what boards are looking for but also understand how to make it a successful transition. So, welcome Patrick, it's fantastic to have you back on the show.

Patrick Dunne: 1:42

Great to be here and lovely to be back for such a fascinating topic.

Hannah Munro: 1:46

I know it's an interesting one. So, what trends have you seen in that? Have you seen it happening a lot at the moment in terms of that shift from CFO to CEO?

Patrick Dunne: 1:57

I think whenever you get a disruptive moment, a crisis or something like that, and growth is sort of held back, you often see a transition in terms of the sorts of candidates that the boards might prefer. In times of crisis, people tend to play safe. They tend to look for people who are going to control the organisation as well as grow it. So, there's a natural... kind of shift when times like these happen. So, I expect, I don't have any statistics yet, but I expect just as in the financial crisis and times before where there's been a disruptive point, I expect you'll see more CFOs being appointed CEOs through this than would be the sort of even normal rate.

Hannah Munro: 2:45

And it's quite interesting, you used the phrase safe pair of hands. So, why is it that the CFO role, of all the sort of senior roles within the organisation, why is it that role is the one that is potentially considered the sort of the safe pair of hands?

Patrick Dunne: 3:00

Yeah, and I would say considered as rather than, that's not always right. But from a board's point of view, you know, the person who has been, you know, the executive primarily responsible for financial control, and in some cases, other aspects of operational control, naturally would be considered the person who would be most controlled in a crisis and most tight, if you like, from a board's point of view. As compared with perhaps, and sometimes unfairly, a CEO who might be considered to be more expansive, have a higher risk appetite. The perception would be anyway, again, not always the case that CFOs have a lower tolerance to risk. And so, therefore, the organization would be less likely to Now, interestingly, there's some work done by McKinsey, which is showing that so, far, the CEOs who've made the bolder steps in the early stages of the COVID crisis actually are the winners. So, it's quite interesting that those who shifted the strategy quickly took, you know, quite brave action quite quickly seem at the moment, it's very early days, that seem at the moment to be doing better than those who battened down the hatches, didn't make much change, and so, on.

Hannah Munro: 4:24

So, does that mean that those that are more likely to promote a CFO to a CEO role are those that are looking for sort of a steady hand on the rudder versus necessarily sort of big expansion plans, et cetera?

Patrick Dunne: 4:40

Well, I think if you step back, the first thing that a board's got to do is to think, you know, well, what is the strategy and what is the context? And a strategy that was right for one context might now not be the right strategy. And you saw through the last 18 months; many organizations changed their strategy. And if the CEO then didn't fit that strategy, you then started to see them change the CEO, change the leadership. So, if the context is different, And the level of your resources is different. If your access to finance is now much less, if your growth prospects are lower, you might actually want someone just to keep it steady for the next couple of years, for this phase of development. I always use the term, you know, for CEOs, CFOs, chairs, you know, you have the right group of people for that phase of development. And so, the first thing a board's got to do is think about what the phase development is and then what is the appropriate style of leadership and competency of leadership that you want for that next phase. Sometimes that favours an incumbent CFO. Sometimes it doesn't.

Hannah Munro: 5:52

So, I think the first thing is for any CFO that would like to make that transition is to understand the context in which they're working and perhaps pick their time well is the answer on that one.

Patrick Dunne: 6:08

Yeah, and get prepared. If you've got that ambition to be a CEO, then I think... you should talk about it. But clearly, if your ambition to be a CEO is to be a CEO next week, and there's an existing CEO who's there, and they're not that far into their tenure, then that's setting up a conflict. So, you have to be careful of that. But if you're making it known that one day, or you'd like to be the next CEO, CEO at the appropriate time and you're quite patient about that, then I think one of the things that a board should be doing and the CFO themselves should be doing is kind of investing in their developments to get them ready. I think an abrupt switch from classic CFO role to CEO role is harder than obviously if they've had some other responsibility within the organisation. if they've run a division or if they've been a non-exec somewhere else, they're going to be better prepared to be a CFO. And that transition, which is often where it goes wrong, it's often not the choice of person, it's the way it's done, will just be easier, better.

Hannah Munro: 7:18

And you made a really good point there about preparing, because like you said, it's not necessarily an instant switch. It's something that happens over time. So, what can CFOs do to show that they, or develop their skills, plus show that they are ready to sort of step up to that CEO role?

Patrick Dunne: 7:37

Yeah. So, in larger groups with more focus on succession plans, often people who are fast track look like they've got the potential to be a CEO one day, but they're in some functional role. And it doesn't just go for CFOs. They'll be given experience at doing another type of leadership role. So, they may have gone in and be a COO. in a division for a year or they may have gone to another country to maybe a smaller country and they've been CEO of a smaller country or smaller division and that's given them that preparation. Sometimes they've been given a non-exec role somewhere. That might be somewhere within the group, or it might be outside. And they've also taken part in other leadership developments. So, they may have gone on an advanced management program or something like that, where there's a mix of people from different sort of functional backgrounds who are all being sort of prepared to be CEO one day.

Hannah Munro: 8:43

Yeah. So, it's about, I guess, making your ambitions long-term aware and finding opportunities or looking, I guess, for opportunities and speaking to your board and your CEO currently about where to find those opportunities.

Patrick Dunne: 9:01

as well. Yeah. And, you know, being a peer to the CEO rather than a... servant to CEO, if you like. You have to be a servant to CEO to some extent. But actually, being that partner to the CEO is more likely to make people think of you when they're thinking the next time for who should be the candidates to go into the CFO ring. What's interesting is we've put this in the context of those people who are rising up from CFO within an organization to be CEO of that organization. But also, obviously, a CFO could go and be a CEO somewhere else. And that brings advantages and disadvantages. Advantages in the sense that no one's got them in the CFO box. Because one of the problems in transition is thinking of people who were CFO yesterday as CEO today. They don't have that problem so, much when they're going somewhere else, but they also don't have the familiarity of the organisation. So, the speed of induction could be slower, but they're not cast in that role that they've been cast in as the person who gets to say no to someone wanting more money for some take all the time. But they don't have that knowledge of the organisation. So, it's a sort of pros and cons type thing. But they're quite different, I think, in terms of situation.

Hannah Munro: 10:21

Absolutely. And I think at some point during this podcast, we should maybe delve into those different scenarios and some of the challenges. So, in terms of that shift, where have you seen successes? Like when have you seen it work?

Patrick Dunne: 10:37

So, I mean, I saw it work really well at 3i when I was at 3i when... We had a terrific CEO, Ewan McPherson, who managed the listing of 3i, the big IPO of 3i. And the finance director at the time was a guy called Brian Larkin. And a number of years later, I think it was three years later, Brian took over as the CEO. Brian had been prepped really well. He'd run a big chunk of the business before. He'd then been CFO through the IPO. So, he knew all the shareholders and he had quite good exposure to them. So, in a public company, one of the things that matters a lot is what do the investors think of the appointment that you're making? And so, one of the positions that a CFO is naturally advantaged in, CFOs tend to have more exposure to, investors than other members of the C-suite. So, they're known, they're either known and respected or known and perhaps not. But Brian was very well respected and that was a very smooth transition. Interestingly, Ewan was sadly passed away a few years ago, but Ewan was a terrific CEO at a very difficult time. The early 90s were a difficult time. Brian was more expansive. well, growth oriented. And so, there was a natural evolution out of the early 90s into what was a sort of very exciting time for the industry in the late 90s. And Brian did a great job of growing the business in that period, just as Ewan had done a very good job through that phase of keeping things together through a store.

Hannah Munro: 12:27

And that's a really interesting point. If we go back to our earlier conversation, so, you mentioned there, but Brian was very expansive. So, he as a CFO was seen as obviously having that financial control, but also as having that expansive nature and looking to grow. So, is there anything that you could put your finger on that you could say, well, that's the reason that we saw him in that light, rather than seeing him as a traditional CFO?

Patrick Dunne: 12:52

No, I mean, I think he wasn't a traditional CFO in this. He hadn't come up through the CFO route. He'd come up through the commercial route. And being CFO, I think, you know, I don't know, because... as I was more junior at the time, but I suspect the board made him CFO in preparation of him becoming even successor. But I think this was a game of chess that was all sorted. Whereas, you know, often it may not be like that. There were other candidates as well, I'm sure. But, you know, I think within the company, I think the company, I mean, people felt he was the natural successor, and it was very smooth as a result.

Unknown: 13:36

Yeah.

Patrick Dunne: 13:37

Incidentally, following Brian, another person, Philip Yeo, was appointed CEO who had a CFO background, and he came in as a CEO and he was from the outside. So, there's a company that did it both ways and both ways worked.

Hannah Munro: 13:57

And that's really interesting. If we think about that CFO, if you're seen as a commercial leader as well as a financial leader, a focused person, that gives you that added advantage. And that's, I guess, why we're talking about, you know, heading up operational areas or small, you know, smaller sections of the business. So, Yeah, so, let's talk about that transition, you know, all those differences of transition. So, one going CFO internally, what are some of the challenges that candidates might experience if they're going from an internal perspective?

Patrick Dunne: 14:32

I think probably the biggest thing is this issue of people seeing you like you were before. And it's a bit like, you know, if you go to university or you go away for your first job, you know, your whole world changes while you're away and you come back to your street. But people, they kind of think it's a bit odd. They're behaving differently. They've got different ideas. They're just acting in a different way. But we know them as this. So, the problem is often for other people, but then it manifests itself back on the CFO. So, one of the things I think that if it's an appointment from within, get yourself seen as more than just a numbers person. Get out and about, stand in for the CEO. Obviously, if this is a good relationship between the two of you, you're a peer. Take every opportunity to be seen as the finance director rather than the finance person. So, you're one of that top team. taking a real interest in the business, how the business works, all of that kind of thing will help you. And also, you have relationships that you've invested in. Some of those will be great and some of them may not. And there'll be people who will be worried. If you're the top salesman and the person who is the CMO put his hat in the ring or her hat in the ring to be CEO and they didn't get it, you know, you've got to get onto things quickly and show that person, you know, that, you know, that person might not have won, but, you know, you really want to keep them and you really, you know, all of that. So, you have to really invest in the relationships and find out what people think properly, you know, because once you're a CEO, what, you know, you can't always believe exactly what everybody's telling you. And so, you have to calibrate, you know, what do people really think? saying um so, if you're a bigger organization you know there's glass door and there's all sorts of things um but get out and about um show them the bigger more rounded self um and that's I think that that helps a lot and get support from the others in the team

Hannah Munro: 16:58

yeah so, leverage those relationships that you already have um to sort of position yourself differently so, So, what are some of the advantages of taking that role? I think we talked earlier about knowledge of the organization. So, we talked about some of the challenges, but what are some of the advantages of making that shift within an organization?

Patrick Dunne: 17:17

So, I think you've also got the advantage that you're a known quantity by the board, but you might be known for something different. So, you may have stronger relationships with some of the non-execs than others because of the role that you've been playing. So, for example, you've probably got a very good understanding of what the chair of the Audit and Risk Committee thinks of you and the members of the Audit and Risk, but you might have less of a quality relationship, if you like, with other members of the board who are focused on other things. The critical relationship is the relationship with the chair. Now, in appointing you, the chair has obviously endorsed your appointment, and they will want this to work. So, I think a good open conversation early on with the chair about, you know, what do I need to do differently? Now I'm a CEO. I would get around the non-execs and talk to them and say, look, you know, it's fantastic to be appointed. You know, just want to get your take. Now the appointment is made. What is it that you're looking from me to do? Getting that C-suite relationship. I think the most important thing is get your C-suite sorted quickly. The sooner you get your C-suite, your team composed how you think it should be for the next phase, the better it will be. That's an absolutely critical thing to do and to do that quickly, not slowly.

Hannah Munro: 19:13

Yeah, and I guess one of the hardest things is finding almost your successor as well, somebody that compliments you rather than necessarily works in the same way that you do. So, have you got any tips for those that are looking for their replacement, as it were?

Patrick Dunne: 19:27

Yeah, so, I think if you think, you know, the average tenure of a CEO in the UK in a public company or large company, companies five or six years. And I think if you look at the evolution of you in that CEO role, that's the average, so, they're all over the place, but that's pretty common. The first couple of years, you've got to get in and do the things that the board want you to do in terms of developing the business. It might be repositioning it, it might be doing a deal, all sorts of things. Then you've got to really sort of, then you're into sort of, and you're doing this before as well, but you're really building for the future and working out, you know, what is the talent that you've got within? What's the talent that you've got within your orbit? And, you know, Towards the end, the second half, if you like, you're thinking a lot about, you know, it's just a human thing. You think a lot about your legacy. You know, what will people remember me for as my time as CEO? What's my stamp on the business? And what do I think it needs for the next phase? And you're discussing that with the board openly. So, you know, I think the better appointments are where the CEO, in a way, you know, it's the board's job to pick the next CEO. But you can influence that in a positive way, not a manipulative way. You know, if you make it, if you have a good strategy, if you agree a good strategy with the board and your grooming is not a popular word these days, but you're developing the next sort of group, and the board has choice. You know, if I'm chair, I love it when, you know, actually there's two or three candidates who could do the job. And, you know, it's the tough job of picking who, not that we've got no internal candidates and we have to look outside.

Hannah Munro: 21:30

So, we've talked a lot about the internal migration path. What does it look like when you're currently in a CFO role and perhaps there aren't the opportunities, the business is not in the place where you can really add value? You know, how do you identify people or find those roles where you might be able to shift out of that CFO role to a CEO role?

Patrick Dunne: 21:57

I think if you've got good relationships with the search firms in the space that you're looking at, so, if you're a social sector organisation, there are different search firms in that space than very large corporate, smaller companies, different search firms. If you've got a very good... sense of what you think you would bring beyond the finance bit because people will take that. Yeah, fine. He's fine like that. But what people don't want is someone who's a CFO somewhere else who wants the CEO title but wants to carry on being a CFO. So, you have to have a good degree of self-awareness around, can I actually let go of a lot of those levers which I've been using, which have made me successful in my current role, one of the hardest things, one of the hardest jobs to do is to be CFO in a company where someone who's been CFO internally or a CFO comes from outside and becomes the CEO. Now, when you're coming in from outside, you don't know that everything is under proper financial control. And all of your natural instincts and urges will be to make sure, rule number one, make sure it's under control. So, you come in and you might actually crowd out the existing CFO. You don't know them. You don't know that you can trust them yet. Trust in terms of not just what they say, but trust in their competence. So, you're trying to get the evidence to say things are okay. But the CFO inside is thinking, this guy doesn't trust me. This woman, why is she checking these things? Why is she seeking reassurance? And it's because of their own anxiety. So, one of the things I like to do is actually to have that conversation beforehand and to say to the CFO becoming– CEO, you know, there's going to be some tough bits of this. It's going to be a bit disorienting being CEO. You're going to have to let go of some things. You're going to have to get comfortable. So, before you start, maybe spend, you know, a decent slug of time with the CFO so, that you've got all that stuff out the way. You know, you've sort of sniffed each other out before you start, if you like. And then you can start on a sort of, you know, a higher level of trust, if you like, before you start. Because you imagine if you come in, it's your first CEO job. And, you know, you've got to get familiar with the business, the people, the board. And, you know, you often retreat in a transition to things you know, things you're comfortable with. Even if you said, you know, one of the things, one of the reasons you want the job is for stretch. Actually, you know, our head is saying that and our heart's saying, oh my God, you know, I must make sure the numbers are in control because it would be incredibly embarrassing if we have a financial problem. You know, so, imagine if you're a public company and the first set of results you produce, you know, it's not quite together financially, either in presentation or substance, and you've been a CFO. That's deeply embarrassing. So, all your instincts are telling you know, make sure that's right. So, I think in that sense, it's difficult. The joy is, you know, you're new. You can ask all those questions. It's hard for someone to be there before. Also, if you're in an existing company, you get made CEO, a new CFO is appointed, and they might be a better CFO than you. In fact, you'd almost want them to be. But then there's a sense of, you know, when they say, why don't we do this? You're hearing, well, he didn't do a good job of that. We're going to do it better now. So, all this psychology is quite important. And I think the chair plays a really critical role in, you know, getting people to understand these are natural urges, natural instincts. But we've got to deal with them kind of in private and not let other people get caught in the crossfire.

Hannah Munro: 26:10

And I think that's a really, you know, you've mentioned the chair a couple of times as a key part. And I guess that's one of the things that CFOs that transition should be looking for is a chair that they can work with well and that they feel that can actually support their transition, you know, in terms of that shift.

Patrick Dunne: 26:29

Yeah, I think so, and also, I mean, there may be other people on the board who might be better than the chair as well at bringing on the CFO. So, I remember at Leap, we appointed a young, in this case, it was a CFO, but one of the other trustees was just, you know, he was sort of the perfect uncle. And so, the CFO in that case, rather than CEO, but it would have worked the same, was just very good at having those private coaching chats going. with the CFO. You know, we had a tremendous CEO, very high energy, very sort of full-on fantastic guy, Tom. But, you know, if it's your first CFO role, and this trustee was excellent at doing that. And it wasn't a sort of, you know, sometimes the chair, because they're the chair, you know... People don't always express their vulnerabilities in the same way until you get to know them. So, I think having a non-exec buddy, if you like, can be quite helpful.

Hannah Munro: 27:38

That's a really great tip for those, whether they're transitioning internally or whether they're doing it in an external environment. In both scenarios, which can really help. Is there anything else that you could help that transition that people should think about?

Unknown: 27:54

Yeah.

Patrick Dunne: 27:55

Yeah, I would get yourself a peer group quickly. So, it's interesting, wherever I've made a CEO appointment as chair or the board has, we've tended to think actually that person now needs to change their peer group. So, if you're stepping up to a CEO role, really helpful to have a peer group, a bunch of people who've been through that transition. It's actually the situational experience that's most important. So, almost invariably, I'll suggest to the new person in that role, CEO in this case, his three CEOs who've made that transition a few years ago, not that long ago, but maybe three or four years ago, talk to them about how that transition was for them, how they managed the obvious issues, some of the things that we've been talking about, and it's private. It's really deep, a lot of the things they talk about. So, actually, when Tom was made CEO of leap um you know he had a little kind of like a little CEO group and I used to have dinner once a month or every other month or whatever the rate was and they just you know they have a good natter a good complaint about their boards and uh and I get it all out and you know it was all private and it was all kind of yeah I had that situation and you know and it may not be a direct comparator or it might be so, I think that getting a peer group um and if they have a formal coach, which obviously in many large organizations people do, that can help too. The other thing that's really important is getting a good sense of how you're doing, which can give you confidence because you'll have this brittle cocktail of elation and anxiety when you get there. Oh, great, I'm a CEO. Your family are very proud, and your mates are proud, and everyone is wonderful and you're strutting your stuff, your first CEO presentations and all the rest of it. And then inside there's always this bit of, well, actually, am I up to it? And people are treating me differently now. People aren't sharing confidences in quite the same way they used to. when I was just the CEO. So, I think you've got to get some sense of calibration around how are you doing? How are you performing? So, you know, I'd ask the chair to get, you know, set up a formal feedback a couple of months in, you know, what are you picking up and give people the right to give you feedback.

Hannah Munro: 30:43

Yeah, give them almost in some, I guess, depending on where they're sitting, permission to be open and honest with you about how things are.

Patrick Dunne: 30:49

going. Yeah, encourage them. Yeah. And actually, I think the other thing that's actually come out through the pandemic really well is that I think a lot of people have got more comfortable expressing vulnerability, you know, saying, I really don't know how we're going to deal with this, but I need your help to find the right solution. As opposed to, yes, I know exactly what we're going to do. Just can't share that with you yet. You get a very different feel and confidence in a leader depending on how they play. And it's okay not to know the answers to everything.

Hannah Munro: 31:21

Absolutely. And I think it's quite interesting how the pandemic and the COVID has actually changed more than we think. It's not just the fact that we're working from home. There are so, many other aspects to it. It's really interesting. So, So, in terms of, I guess, you know, are there any situations where it hasn't gone well that you've come through? What learnings can you sort of share from that process?

Patrick Dunne: 31:48

Yeah, so, the reasons are usually fairly straightforward. You know, might be a very good person, but wasn't the right person for that organisation at that time with that board. So, A number of things have to be aligned for it to work. And you can probably cope with one of them not being aligned. But if you've got two or three of them that aren't aligned, then it's probably not going to... It's an airline accident. No one single cause of failure, but the weather was rubbish. There was a problem with the plane and the pilot was not concentrating. It's usually a combinatorial thing rather than a simple thing. Not... actually doing the CEO job and not understanding it's a very different job from the CFO. It's not CFO plus. It's a different job. And really acknowledging the areas of the CEO job where you may not have had experience or you may not be that strong and getting, you know, getting up to speed on that issue or that type of thing as quickly. There's a natural tendency as well when you take over a CEO job to try and overdo it. So, the other thing I've seen is not getting that balance of effectiveness and pressure right. You put far too much pressure on yourself. You try and do everything in the first 100 days. The 100-day thing is a good thing, but actually, it does drive some people to exhaustion. And not just them, their team. So, you have all these ideas, particularly if you've been inside the company, you know, and you're thinking, when I'm CEO, I'm going to. And this list is growing and growing by, you know, the month. And then you get to be CEO and you're right, we're going to do this. And you've got your action plan, and you're determined to show, you know, that you're a leader and you overdo it. So, I think pace is quite important that, you know, you've got to be clear what the point is, what your purpose is, and then clear about the pace. The other thing is that you communicate in the most effective way. So, sometimes the CFO hasn't been out front communicating. And, you know, some of these things are a bit scary, you know, town halls so, that's why if you're before you become CEO if you can step in for the CEO a town hall type meeting you know from time to time you'll be comfortable with doing that if it's your first town hall it's your first one as CEO and it's in a new company you know that can be all a bit of a scary experience can't it so, uh if that the media is another thing so, if you're in a company where you know there's media interest um you know we've all seen the YouTube videos of people making a complete hash of these things as CEO if something goes wrong, but actually how good are you on the communication side? Again, in prep, even if you've had no prep on that before, in between you being selected and you starting, go get media training. I think a lot of people spend their time in that spell, learning, learning, learning, rather than sort of developing, developing, developing. So, think honestly about the things, the bits of the game that you're less strong in and go get that development in that time before you start because it will really help you when you go. The other thing that people often... I remember we talked about it before is they just... Keep behaving as a CFO rather than a CEO. And it's a really hard thing. It's the same if you're a non-exec and you become chair. You have to behave in a different way. And some is the same and some is different. So, I think thinking about how you– I mean, there's this sort of difference between being and doing, I suppose– You know, a CEO has to be more, if you like. And it's about getting other people to do things. It's about picking what things people do as opposed to doing all that sort of basic stuff. I think you just have to go back to, yeah.

Hannah Munro: 36:11

Absolutely. And some great tips there for anyone that's even, you know, considering stepping up and can get a sort of a step up. And if a CFO came to you now and said, right, what are the top three things that I could do now to get myself in a position where I'm either ready or seen as ready for that CFO role? What would be your top three takeaways?

Patrick Dunne: 36:35

I'd say, first of all, think about what a CEO has to do and how they need to be and think about where you're at now and which are the Where's the good mapping onto that? So, which bits have you got sort of nailed now you're strong at? Which bits are you less sort of comfortable about? And really get up the curve on those. Number one. Secondly, think about how you're going to manage the transition if you do get into that position. And then thirdly, how can you maximize the chances of you being considered for that position? So, what's your visibility with the board? What's your visibility with the search firms? You know, what's your credibility within the organisation if you'd love it to be within that organisation? Do you really know all the key movers and shakers? Because if the board sort of is thinking, well, should we appoint Hannah as CEO? And, you know, they will naturally as they're doing their sort of chats around and go, you know, oh, they might say, you know, I think Hannah's doing a really good job at the moment, you know, or, you know, be interested in your take on it. You know, I think Hannah did it that last week. They'll do all these things. And if the answers they're getting is, wow, you know, yeah, Hannah's great. You know, we really respect her. And, you know, there's what people say and there's what people think and how they express it. And good board members will know when someone says, oh, yeah, Hannah did a really good job at that. The tone doesn't match the words. They'll pick that up. Or if you don't look at them straight in the eye when you say, yeah, I think she did a great job last week, they'll pick all that up. And they'll be calibrating as they go. Good board members are always on the lookout for who might be the next CEO or who might be good candidates. So, they'll be wanting to get to know you. Get to know the board as a whole, not just the chair or the chair of the audit and risk committee would be another thing. Make sure they know who you are, they rate you, and they like you. I mean, it shouldn't count in a way, but it does count. So, if you're a fantastically precise CFO and you're right most of the time, but you're sort of irritatingly right– You know, people are going to say, well, you know, this person's just not going to be good to be with for the next six years. You know, there might be another choice, which is just as good, you know, in terms of competencies, but actually it's just easier to work with. So, I think you've got to watch that sort of thing as well.

Hannah Munro: 39:18

absolutely that's a really good point um in terms of those relationships and just making sure you're seen in the right light rum and no like and trust is a massive piece in all you know in all areas isn't it in terms of making choices yeah you'll always have a logical reason to back it up but a lot of the time you'll go on your uh your instincts so,

Patrick Dunne: 39:38

yeah, and never ever do anything to undermine the current CEO you know I've seen some CFOs want to hurry the process along a bit.

Hannah Munro: 39:47

uh

Patrick Dunne: 39:48

And that's a mistake generally, because smart board members will know what you're doing. Yeah.

Hannah Munro: 39:54

Yeah, no, absolutely. I think, yeah, don't underestimate your board, I think is the piece there. So, oh, sorry.

Patrick Dunne: 40:03

No, or overestimate them.

Hannah Munro: 40:07

That's a really good.

Patrick Dunne: 40:09

point. They, you know, board us with anyone else and they're not homogeneous in terms of quality and rigour and all the rest of it. So, you know, don't take for granted they might be doing something which you think they should be doing because they might not be.

Hannah Munro: 40:25

Interesting. So, yeah, so, get a gauge on where your board is at hand, you know, know them, you know, as their strengths and weaknesses as well as your own. Wonderful. So, any, because I'm very aware that we, this is, this podcast has just flown by as it did last time to be very fair, Patrick. So, are there any final thoughts you'd like to share with our audience? Any CFOs out there that are either considering or, you know, looking for that option?

Unknown: 40:54

Yeah.

Patrick Dunne: 40:54

I think one of the things that you will have to do as CEO, which you will play a part in as CFO, but you won't have played the major part in, is developing the culture of the organisation. And in order to do that, you need to know what culture you've got and what culture you want and then figure out how you're going to move from one to the other in what will be a relatively short period. You can't microwave culture. It takes time. And culture is driven by behaviours and behaviours are driven by values. So, one of the things I think to get really clear in your head is what are the values that you stand for? And they may be perfectly aligned with the current values of the organisation and the current culture, but thinking hard about what do you want the culture of the organisation to be on your last day? And What are you going to do to actually get it closer to that during your time? And I think that's as important as any operational strategic type thing that you might have on your things to do in your 100 days. What are you going to do to start the culture change if you think one is needed or just a development of the culture? I think that's probably the thing I would focus on because that often defines your leadership.

Hannah Munro: 42:08

Yeah, how will you be remembered and what will it be like when you leave? What will your employees say about you?

Patrick Dunne: 42:14

Yeah, and you don't want it to be, thank God they're going. You want it to be, you know, blimey, they did a fantastic job, and they've left the thing in great shape. And, you know, wow, we've got three potential successes to pick from. Lucky us.

Hannah Munro: 42:28

Absolutely. Well, thank you so, much, Patrick. As always, it has been a fascinating conversation. And thank you for sharing your knowledge and insight with us. For anybody that is interested, I can genuinely recommend Patrick's book. I've read it a few times myself. Some great content in there. So, I will pop those links into the show notes that anyone wants to look at. But thank you again, Patrick. It has been fabulous having you back on.

Patrick Dunne: 42:55

Absolutely. My pleasure as always. Thank you.