How do salaries for CFOs and finance leaders stack up across continents? This questions isn't always easy to answer, with pay conversations mostly off limits in polite society.
But it's important, and something current and aspiring CFOs need to know. So we took it to an anonymous survey.
We surveyed more than 300 finance executives from the CFO Connect community on a range of salary and compensation topics. Survey results show that there are large differences in pay within Europe and the United Kingdom, in comparison with the USA.
Let’s explore the highlights in more detail. You can download the full report here:
1. Finance director salaries depend heavily on country
It’s commonly accepted that salaries differ depending on location. The same job in London pays more than Manchester, New York pays more than Des Moines.
This is for a variety of reasons: cost of living, competition in the job market, and the overall value placed on certain roles in each location.
So how much do finance executive salaries depend on the country you work in? Based on our survey results, this makes a considerable difference.
Salaries in France are by far the lowest in Middle and Northern Europe. In Germany, salaries are on average 26% higher, and in the UK they’re 51.5% higher.
Only in some countries of Southern Europe (Portugal, for example) and Eastern Europe did we find lower average compensation. (These countries are included in “Other”).
But perhaps the biggest headline from the graph above: Salaries in the US are significantly higher than in Europe. Even compared to the UK, where the average is still 21% lower than across the Atlantic.
And specifically for CFOs, the differences appear more pronounced.
2. CFO compensation follows the same trend
Given what we’ve just seen, it’s perhaps unsurprising that CFO salaries specifically are closely tied to physical geography. But one fact jumps out immediately: US-based CFOs in our survey earn more than double that of their French counterparts.
French CFOs also earn 43% less than their colleagues in Germany - and 78% less than in the UK. The range (in brackets) also shows that CFO salaries in France appear to have a lower ceiling, as opposed to their colleagues in other countries that can earn well over €200,000 per year.
Taken together, these two graphs show that salaries are closely linked to the country a finance leader works in. Naturally, this will affect the talent pool and likelihood that a CFO or finance executive will choose to move between countries for work.
“I've worked in Europe and Asia, and always found the adventure of living and working in a new country alluring. At some point I would consider moving back to France even with a pay cut, but not now because I have two kids who will both be going to university in the next few years. The one huge advantage in Europe though that would appeal to people with younger kids is the availability and accessibility of childcare, which makes life so much easier for working parents. I think that’s a strength that should be promoted to attract early and mid-level professionals to Europe.”
3. Experience is a key determinant of CFO salaries
As with all jobs - finance or otherwise - it’s natural to assume that a professional’s level of experience will strongly influence how much they can expect to be paid. And based on this survey, that assumption is correct.
Salaries seem to increase by roughly one third with every five years of experience. But for more senior levels (+15 years of experience), the increase is less significant compared to previous levels.
This confirms previous assumptions. But we also see a more significant jump once we move from 6-10 years’ experience, to 10-15. This could be for a number of possible reasons:
- Professionals may take the step up to more senior roles at this point
- Many finance workers may leave the profession prior to this
- Some recruiters may see 10+ years of experience as a key negotiating asset, and salaries can increase steeply from there
Whatever the reason, it's clear that time spent in the profession is valuable for finance professionals seeking higher pay.
4. Finance salaries follow a logical hierarchy
This graph is more a confirmation of common logic than a revelation. As finance professionals progress through various typical job titles, their salaries tend to increase:
It’s worth pointing out a few quirks in this particular graphic. For example, British readers might be confused about the difference in salary between CFO and Director of Finance. In the UK, the two roles are often synonymous.
But in other countries there’s a clear distinction. And in general, there are no set rules or laws around job titles.
It will also be up to each company whether the first controller hired is their Head of Controlling, or a Financial Controller. These differences are really a question of company culture and hiring practices.
We know that the CFO is often the first full-time finance employee in startups, for example, and their salary will be lower in a smaller company (see further analysis below). So it’s not necessarily a case of CFOs working their way up the salary ladder - it’s a question of leverage and negotiations.
Despite these quirks, this analysis pretty clearly shows the finance function career ladder, and gives a benchmark for CFOs and hiring managers to work from as they build their teams.
5. Remote work is still not the default for finance teams
One might assume that the events of 2020 and early 2021 have created a clear acceptance and embrace of remote work. With the right tools and processes, finance teams can easily work from home and be just as productive.
So when we asked this question in our CFO survey, the results were quite surprising:
First, a small but real minority have no option to work remotely - even part time. This is despite the fact that all of these jurisdictions have had lockdowns in the past 18 months. Clearly, some businesses just aren’t comfortable with this arrangement.
Again, we see very clear differences between geographies. Only 27% of French finance leaders have the option to work full time. This is despite demands from governments that those who can work remotely should.
Either this was seen as strictly a temporary measure for French companies with no lasting change, or they simply don’t believe that it’s possible to work remotely full time.
"Historically, ‘télétravail’ had to be added specially in French employees' contracts, which led to legal and HR difficulties. It's slowly changing now but can explain why the shift isn't as radical as in other countries. And in certain European countries, talents also have been centralized in major cities in the past, so companies didn’t need to look for remote workers elsewhere."
Quentin Servais Laval, Director Finance & Operations at Double
Get more insights into finance compensation
These were five selected points from our recent survey. The final report is full of fascinating data, both confirming prior assumptions and uncovering new truths.
Use it as statistical support for your articles, or to benchmark your own company's pay scale. Either way, we hope it helps.