A lack of female representation among Chief Financial Officers (CFOs) in Indian and US-based unicorns has been highlighted in a report by WalkWater Talent Advisors. Just 4% of CFOs in Indian unicorns are women, compared to 17% in the US.
Over the past few years, there has been mounting evidence that greater levels of gender diversity can have a positive impact on corporate performance and economic growth. However, a report by WalkWater Talent Advisors highlighted a lack of female representation in the role of Chief Financial Officers (CFOs) in both India and US-based unicorns.
According to the study, in Indian unicorns, 96% of CFOs are men and only 4% of women account for this job role. In the US, 83% CFOs of unicorns are men while only 17% are women.
“In the last 5-6 years there has been a push to improve gender diversity when it comes to product development and product management. There is a range of hackathons for women, and branding is being done to hire women engineers and developers. I guess such measure will help create a stronger pipeline of top roles for females,” Harold D’Souza, co-founder and Director WalkWater Talent Advisors told Mint.
Over the past year, more than 15 Indian unicorns have appointed CFOs while over 12 CFOs have resigned. These unicorns collectively possess more than $350 billion in valuation, the study by WalkWater added.
In the past few years, India has witnessed a significant surge in the number of unicorns, and a couple of them have launched their initial public offerings (IPOs) while several others are planning to do the same. However, during post Covid-19 pandemic, the majority of the unicorns have witnessed funding winter. Investment into Indian start-ups is down 75% in the first quarter of 2023.
Notably, over 20 unicorns were created in the first nine months of 2022 but after that not a single unicorn has accomplished this title in the last eight months.
The WalkWater report mentioned that only 33% of unicorn CFOs were hired from other startups indicating a higher reliance on talent from traditional sectors. BFSI (18%), Industrial (16%), and FMCG (14%) are the top 3 sources of the remaining 67% of the non-startup talent pool. In contrast, in the United States, 72% of Unicorn CFOs were hired from other start-ups with Enterprise SaaS (58%) and Fintech (16%) emerging as the top talent sources.
An analysis of 100 Indian unicorns and 50 US unicorns by WalkWater also found that Indian CFOs are younger than Americans. In India, 15-25 years of experience make up 60% of the talent pool. On the other hand, in the US, 20-30 years of experience make up 60% of the talent pool.
Delhi-NCR and Bengaluru are the hottest hubs for CFOs hiring in India. The study mentioned that the base location of nine CFOs is the US and one in Singapore. Of these 10 CFOs, 50% have US citizenship. 35% of CFOs are in NCR, 32% in Bengaluru, and 16% in Mumbai, respectively.
Speaking about the role of CFOs, D’Souza and Gibin Varghese, Partner-Technology Practice at WalkWater Talent Advisors, said, “The role of a CFO at the strategic level is fundraising, merger, and acquisition, investor relations, board relations. The tactical role would be controllership and business alliance. The importance of the CFOs role varies as per the stage of the company. In a unicorn, the role of the CFO becomes much more strategic in terms of fundraising for the future, dealing with a larger investor, preparing the company for an IPO, and dealing with larger regulatory issues”.
“The Indian startup ecosystem has witnessed an exceptional surge in unicorns, reflecting the resilience of many entrepreneurs. However, it’s intriguing to discover that despite their significance, 30% of unicorns continue to rely on VPs of Finance instead of embracing the full potential of CFOs,” they added.
Source: Mint