CFO Salaries Rise 4% in 2024 Amid High Demand

As the role of the Chief Financial Officer (CFO) becomes increasingly complex, the demand for top finance leaders is on the rise. This heightened demand is driving steady increases in CFO salaries, even as public companies navigate economic uncertainties. New data from Compensation Advisory Partners (CAP) reveals that in 2024, the median base salary increase for CFOs was 4%, while CEOs saw no change, mirroring the trends from 2023. In 2022, the median base salary increases were 3.8% for CFOs and 2.9% for CEOs.

Kelly Malafis, founding partner at CAP, noted that despite expectations of a downward shift in salary increases due to the labor market, CFO salary increases are likely to remain steady. This stability is attributed to high turnover rates, driven by retirements and departures, as well as strong demand for finance chiefs. The CFO role has evolved into a key leadership position and strategic partner, contributing to higher pay. As companies face various challenges, CFOs have become central to these strategies, requiring skillsets beyond core finance expertise to prepare for the future.

Some notable CFO hires in 2024 include Anat Ashkenazi, who joined Alphabet from Eli Lilly, and Sarah Friar, who moved from Nextdoor and Square to OpenAI. Karen Parkhill also made a significant move, becoming CFO of HP from Medtronic. These hires underscore the growing importance and complexity of the CFO role. CAP’s analysis found that for executives who received a salary bump, the median increase was 5.7% for CFOs and 4.1% for CEOs. The previous year, CFOs’ median increase was 5%, and 5.1% the year before that. CAP does not expect a significant decline in CFO salary increases next year.

Although CFOs are currently seeing greater salary increases than chief executives, CEOs still lead in total compensation. Over the past decade, CFO total compensation has averaged about 33% of CEO compensation. The median tenure for these positions is typically around seven years. Every time there’s a reset, the bar is reset again, which is why that ratio stays at about a third. At public companies, long-term incentives (LTIs) for executives are usually delivered through time-vested restricted stock, performance-vested stock, or stock options. One trend highlighted is the reduction in the number of companies using all three vehicles. Five years ago, 33% of companies surveyed used all three, compared to just 22% today.

Performance-based equity plans remain the largest component of LTIs for both CFOs and CEOs. LTI awards increased an average of 7% for CFOs and 5% for CEOs in 2024. Over the past decade, LTI awards have grown by an average of 6% annually for both roles. Bonus payouts in 2024 rose 2.6% for CEOs and 5% for CFOs. Total direct compensation increased 3.5% for CEOs and 6% for CFOs, mainly due to higher long-term incentive awards. With demand for skilled finance chiefs rising, CFO compensation is expected to remain strong.

Notable CFO appointments in 2024 include Jesus "Jay" Malave, who was appointed EVP and CFO of Boeing, effective Aug. 15. Malave brings extensive experience from Lockheed Martin and L3Harris Technologies. Pierre Revol was appointed CFO of FrontView REIT, Inc., effective July 21, bringing over 20 years of experience from CyrusOne and Spirit Realty Capital. Marc Grasso was appointed CFO of Kyverna Therapeutics, Inc., effective June 30, succeeding Ryan Jones, who moved to a strategic advisor role. Grasso brings over 25 years of experience from Alector, Inc. and Kura Oncology.