Is your CHRO poised to become CEO? How the pandemic changed C-suite succession

For anyone who dreams of having the title of CEO, the world of finance has long been seen as a shortcut to leadership positions. But as the demands of the workplace have shifted due to the pandemic, so have the power dynamics of the C-suite. Now, chief human resource officers are increasingly poised to become the big boss.

In recent years, chief finance officers have been seen as frontrunners in any race to become CEO at an organization. Historically, it's been extremely rare for a CHRO to move into the CEO position, according to a 2014 study conducted by the Harvard Business Review. But the fallout from the pandemic fundamentally changed the needs and the demands of the workforce. 

"The path from CFO to CEO really started happening in 2008 with the financial crash," says Amy Spurling, founder and CEO of employee stipend platform Compt. "[They] made all the decisions about what needed to be cut because companies were in survival mode. But the pandemic wasn't a financial crisis — it was a human management one."

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The role of CHROs has become more dynamic and more strategic throughout the course of the pandemic. While the function had previously been seen as limited to payroll and compliance, the responsibilities of the job largely ballooned since 2020, as staffers' shifting needs became top priority to many organizations. Now, CHROs are seen in the same powerful position as CFOs have long been: In a position that touches every corner of an organization. 

"The beauty of HR is that it has evolved to be something more strategic," Spurling says. "It's now about making more data driven decisions, thinking about where we go next and how to scale the company and accelerate growth, but looking at it from a people lens. It's recognizing the need to hire the right people at the right time because if you don't you're missing a market opportunity. Looking at things from a human capital  perspective can be very powerful." 

Eighty-nine percent of CEOs recently surveyed by IT company Accenture said that the CHRO should have a central role in ensuring long-term profitable growth. And even though only 45% of those CEOs say they're already actively creating the conditions to allow that, the conversation is still moving forward in a new wayaccording to Spurling. 

"We weren't seeing any kind of attention before the pandemic," she says. "Not until they were finally allowed the space to actually take that leadership role and show companies that if they don't have the people, they don't have a team. It didn't just get them a seat at the table, it put them in charge of the table."

Spurling, who served as a CFO twice before founding her own company and stepping into the role of CEO, says she chose to go the financial route because at the time, she knew it was the fastest way to the C-suite. But in the current job market, especially given the uptick in layoffs, she now sees HR as perhaps the quickest path to leadership positions. Today's employees need a leader that is empathetic to their cause. 

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"A CFO is going to be looking at the numbers — what makes the numbers move and how do we move the needle on cutting costs and increasing revenue," she says. "A CHRO still has to manage a budget, but they're also going to understand that it's not just a matter of cut, cut, cut. You can't do that and retain people in this market." 

Which isn't to say that CFOs are irrelevant, Spurling stresses — their role was and is vital to an organization's success. But as the role of CHRO continues to expand, there's a new opportunity for collaboration and partnership in the C-suite, and regardless of who may be vying for the ultimate title of CEO, partnership between these positions and their respective departments will contribute to the health of any business. 

"The best solution is a really tight partnership between finance and HR," Spurling says. "Those two groups have to be in lockstep and have to be on the same page for us to weather whatever this is right now."