Accepted Abroad

European finance chiefs may find that their IFRS experience is in demand from US companies.
John ZhuOctober 6, 2008

Bedi Singh may have grown up in India and studied in the UK, but it’s the call of Hollywood that has defined his finance career. His appointment in May as CFO of MGM, the iconic film production and distribution company, follows stints as the finance chief at News Corporation’s Fox Filmed Entertainment and Sony Pictures Entertainment in Los Angeles. It’s all a long way from his early years at Arthur Andersen in London.

Such a career path would make leave plenty of finance executives in Europe green with envy. Despite the onerous demands of Sarbanes-Oxley, a stint as CFO of a US company is a challenge many of them would relish. But the truth is, it’s not often that a European lands the top finance job of a major American company. But with the transition from US GAAP to IFRS just around the corner, will demand from US companies for European candidates increase?

Phil Wall, a CFO who has first-hand experience of Europe’s “mammoth task” of switching to IFRS, reckons that the experience will be valuable in the US. Originally from the UK, Wall joined First Data, a Colorado-based payments-services firm, in 2002 with more than ten years of international experience and has been CFO there since June. What’s more, Wall says European CFOs have other skills that could be increasingly attractive to US companies wanting to expand internationally, such as the ability to work in different cultures and languages. Europeans are also more accustomed to managing various statutory tax and legal matters. “Sound knowledge in these areas will go a long way,” he concludes.

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But according to Christopher Langhoff, a recruiter at Russell Reynolds in New York, US firms still need a lot of convincing to hire from outside their own borders. While he concedes that IFRS is looming large, he believes American hirers place more importance on whether a candidate has worked in the US before and has experience of managing US investors. “Many US firms see investor relations on separate sides of the Atlantic as totally different experiences,” he says. Even if a European candidate ticks those boxes, legal hurdles might be a turn-off for a US employer. Langhoff recently placed a treasurer at a US energy company who had to work in a London subsidiary for a year to make sure he didn’t fall foul of US immigration regulation.

There are also cultural issues to bear in mind. Having worked at American firms throughout his career, First Data’s Wall knows American management styles well, whether it’s the “really early” start of the work day or “the need to execute on every initiative with a massive sense of urgency.” Singh adds that CFOs get “more hands-on accounting experience” in the US than in Europe, and the differing business culture in the States means a finance chief is expected to “roll up his sleeves and join in the hustle with the rest of the department.” European companies, in contrast, tend to have sharper divisions of labour. IFRS or not, without being aware of such differences, European finance execs’ American dream will remain just that.

John Zhu is a senior staff writer at CFO Europe.

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