As the nation's large banks have morphed into financial services companies with huge balance sheets and multiple businesses, the job of chief financial officer has naturally grown more complex.
But the pressure on CFOs has further intensified recently. The flagging economy and the collapse of the Houston energy trader Enron Corp. have placed them under increased scrutiny by investors and analysts, who have put everything from loan quality to balance sheets to accounting practices under the microscope.
Over the last several months a collection of financial services companies have fired or replaced their CFOs. While it is not clear in every case whether the changes are directly related to poor performance, what is certain is that being a financial services CFO is as tough as it's ever been.
"It's one of the toughest jobs in American industry," said Richard X. Bove, a banking analyst for Hoefer & Arnett of San Francisco. "It's a very complex job, and if you're talking about a bank, you're talking about a job that requires an unbelievable amount of skill to function."
When a CFO leaves, for whatever reason, the news is sometimes seen as a harbinger of bad news.
Mr. Bove and other analysts cited the example of Wells Fargo & Co., which announced in April, two weeks before a quarterly earnings report, that Ross Kari was stepping down as its CFO. Shares of the San Francisco company fell 6% the day of the announcement, because investors expected the earnings report to contain bad news.
When the report came out, it included a $1.05 billion charge to write down private equity investments.
"We don't know, as outsiders, whether the chairman [of Wells] blames the CFO for that or not, but he left and Wells got hit with a big loss," Mr. Bove said.
In more recent changes, Comerica Inc. of Detroit said Tuesday it hired Ford Motor Co. Treasurer Elizabeth S. Acton to become its chief financial officer next month. Also Tuesday, State Street Corp. of Boston said its chief financial officer, Ronald O'Kelly, had unexpectedly decided to step down at the end of the month for "personal reasons."
In Comerica's case, Ms. Acton will fill a position that has been vacant since January, when Ralph W. Babb Jr. was promoted to chief executive officer and president. Ford recently reported its first full-year loss in nine years.
State Street gave few clues about why Mr. O'Kelly, who has been with the company for seven years, decided to leave. Analysts say there are no signs that it has anything to do with the company's financial health, but the news spooked investors, who sent the stock down about 3.5% in trading on Tuesday and Wednesday.
However, in the case of last week's departure of Conseco Inc.'s Chuck Cokel, the Indianapolis company's CEO, Gary C. Wendt, sought quite candidly to stifle "rumor and misinformation" that Mr. Chokel had resigned.
In a memo to shareholders last week, Mr. Wendt said that he had fired Mr. Chokel. "Chuck did not resign. His employment was terminated. I let him go because I did not believe that he was up to the job."
Both former and current CFOs said that what has always been a tough job has gotten harder in the wake of the scrutiny applied to accounting practices since the collapse of Enron.
"Enron-type situations have raised the level of scrutiny over the quality and the integrity of corporations," said Christopher V. Dodds, the chief financial officer at Charles Schwab Corp. in San Francisco.
"I think we're in an environment which is difficult," said Robert McCoy, who was the chief financial officer of Wachovia Corp. before First Union Corp. bought it on Sept. 1 and adopted its name. "Obviously, there is much more demand for transparency now," said Mr. McCoy, who is now a co-head of merger integration at the new Wachovia.
With all the added pressure, chief financial officers at many companies are scrambling to make sure they keep their companies on target and maintain good relations with colleagues and Wall Street.
Mr. McCoy said that as a CFO guides and describes a company's performance, he or she must strike a balance between conflicting goals, such as long-term growth versus short-term stock price appreciation.
Wachovia's management and board are "in it for the long haul," but on Wall Street, "a company's performance is measured on quarter-to-quarter earnings momentum," he said. "It leads to pressure for doing things on a quarterly basis that you might not do if you were taking a year-to-year approach."
However, Mr. Dodds says both Schwab's ongoing bid for transparency and its simplified business approach make his job easier than that of other CFOs.
"I think compared to lot of companies I personally don't have as stressful a time as others," but "I spend a lot more time talking to the audit committee and to our board members than before," he said.
Niamh Ring and Veronica Agosta contributed to this article.
