When fast-growing companies realize it’s time to take a more strategic approach with their finances, many decide to bring on a director of finance to help them set long-term business goals.
A skilled director of finance can be a valuable asset for a startup or another small business that is looking to expand its operations, has received an infusion of capital, is preparing for an initial public offering (IPO), or all of the above.
Some businesses rely on interim management consultants to handle the director of finance role because the hiring process can take a long time in today’s market, where available, skilled financial talent can be hard to find.
The director of finance salary: 2020 outlook
Understanding how to manage growth today while also forecasting future financial needs is a skill that’s earned over time. That’s why employers usually seek a director of finance for their team who has at least 10 years of experience in accounting and finance.
As for the director of finance salary, many businesses are prepared to offer competitive compensation to seasoned professionals. According to the Robert Half Salary Guide for Accounting and Finance Professionals, directors of finance in the United States who work in corporate accounting departments can expect to see a midpoint salary of $152,250 in 2020.
To see more projections for the director of finance salary as well as compensation for many other roles, access our latest Salary Guide.
Typical duties for the director of finance
The range of responsibilities that directors of finance may be asked to handle depend on the size of the company and whether it has other financial leadership in place, such as a controller. In addition to directing an organization’s financial policies, the director of finance may oversee all financial functions at the company, including accounting and tax. The director of finance may also play a key role in financial planning that supports business growth and development.
Generally, the director of finance is expected to:
- Oversee insurance and risk management
- Maintain budgeting and forecasting models
- Perform financial modeling and analysis
- Assist with business funding decisions
- Hire, train and retain skilled finance staff
Many directors of finance also need to collaborate regularly with leaders of other functions in the company, such as human resources, legal and IT, to discuss budgeting, planning and financial strategy.
Skill sets that employers seek in a director of finance
The director of finance is part of a company’s core management team, so candidates need to have strong leadership abilities — and ideally, some previous management experience. Technology skills, including experience with financial systems, and analytical abilities are also necessary for this role. Many employers value previous experience in public accounting, as well.
Directors of finance need strong public speaking and other communication skills, as they must be able to clearly explain financial information to management, the board of directors, investors, employees and others. They also must have the fortitude — and diplomacy — to challenge decisions by management that may not align with current budgets, financial policies and plans, and could put the firm at risk.
As for educational requirements, most employers expect professionals applying for the director of finance role to have a bachelor’s degree in finance or accounting. Many companies prefer to hire candidates who also have earned a master’s degree in business administration (MBA) or an in-demand professional designation such as certified public accountant (CPA) or certified management accountant (CMA). The types of certifications and other specialized knowledge that a candidate can bring to an organization can also have an impact on the director of finance salary they could earn.
Businesses planning for an IPO, a merger or acquisition, or some other major transaction or change event may seek directors of finance who have previous experience in these areas. Today’s complex and ever-evolving regulatory environment is also prompting many employers to require candidates for the director of finance position to have extensive knowledge of relevant compliance mandates.