Do you feel you're on the Chief Financial Officer or Chief Operating Officer merry-go-round and want to have a shot at being a CEO?
Analysis shows that all ASX300 CEOs appointed in the last year at Australia’s largest 300 companies listed on the Australian Securities Exchange previously held these kinds of feeder roles.
We explore the pros and cons of stepping into the CEO role—and offer strategies to help you get to the top.
Pros of becoming a CEO
The money factor
If compensation is your key motivator, then becoming a CEO is certainly a lucrative goal to work towards.
According to the Australian Council of Superannuation Investors’ annual audit of CEO pay, chief executives at the 100 largest listed businesses averaged $5m in the 2023 financial year. That works out to 50 times a typical worker’s wage on average.
Opportunity to make an impact
CEOs carry a tremendous amount of responsibility within an organisation and are accountable to the Board of Directors. However, with that comes the ability to make a real impact on the strategic direction of the company and its culture.
The CEO’s values and leadership style will play a key role in driving the organisation’s long-term vision and growth.
Legacy building
CEOs have the opportunity to create an enduring legacy from the work they do. Whether that involves improving sustainability in your industry, coming up with an innovation that benefits customers or society as a whole, or boosting the financial success of the organisation, the legacy-building element of being a CEO can be extremely rewarding.
Cons of becoming a CEO
The loneliness factor
Being at the top can be lonely, as technically you won’t have peers of your own. Sure, you’ll report to the Board and work with the rest of the executive team to carry out the organisation’s strategic plans. However, at the end of the day, you will be the leader at the helm and largely a lone wolf.
“A CEO role is probably the loneliest role within the organisation,” says Executive Interview Coaching founder Richard Elstone.
High stress
The pressure and responsibility that comes with being CEO can be immense and challenging at times. The CEO can delegate responsibilities to various departments, but they are still responsible for the overall running of the company and its success.
When something goes wrong with the company, your name will be in question and you will need to face up to the public, media and shareholders.
Ethics and corporate governance challenges
Balancing the interests of staff, customers, shareholders and the broader community can be challenging. Ensuring the company remains compliant with laws and regulations will be your responsibility, in addition to making sure business is conducted in an ethical manner.
How to become a CEO
To become a CEO, you need to tick a variety of boxes. Aside from having the relevant qualifications and practical experience, you’ll also need significant leadership experience, as well as other skills like emotional intelligence and empathy.
The Board will want to see evidence of certain skills such as strong communication, critical-thinking and decision-making abilities, as well as a track record of making a measurable impact in previous roles. A strong financial acumen will likely be a must for a CEO position, which is why so many CFOs end up moving into the role.
Here are some tips for working towards a career as a CEO.
Gain diverse experience
Gain as much experience as possible in various business functions. If you’re a finance executive, try to work across operations or sales, or vice versa. If you work in marketing, see if you can pick up some experience in operations or another department that will broaden your skillset.
“The common thread with most CEOs is that they have skills in multiple areas and more than one specialisation as part of their background,” says Richard. “Put yourself forward for opportunities that will allow you to broaden your skill base.”
You may consider moving sideways within your current organisation to gain new experience, or do some advanced education. It’s a good idea to focus on continuous learning and self-improvement by doing courses, going to seminars and reading about areas or skillsets you need to build on.
Showing that you’re a proven leader who wears many different hats will help your case when being considered for a CEO role.
Get leadership coaching
Whether you’re a seasoned leader or a new one, it’s worth investing in leadership coaching, says Richard.
A leadership coach can help you to improve your leadership skills, build your confidence as a leader, communicate better with your subordinates and give you a fresh perspective on areas for improvement.
“This kind of mentorship can prove invaluable when it comes to demonstrating you’re an effective leader and can make a valuable impact as CEO,” says Richard.
Invest in executive interview coaching
When the time comes to apply for a CEO role, having a professional on your team who understands what the Board will be looking for is crucial.
Executive Interview Coaching has helped some of Australia’s top-level CEOs land their dream roles by equipping them with the tools they need to succeed in the interview room.
From fine-tuning your resume to running through the types of interview questions you’re likely to encounter, Executive Interview Coaching will position you for success.
To find out more, get in touch today.