Booming job market, strong demand for CFOs
The sudden exit of Moderna Inc.
The newly hired CFO sheds light on the challenges companies and recruiters face in a tight job market, in which candidates often have more than one competing offer, forcing hiring managers to make quick decisions.
Jorge Gomez, who started as Moderna’s chief financial officer on Monday, left on Tuesday, effective immediately, the Cambridge, Mass.-based company announced. He was recruited by dental supply manufacturer Dentsply Sirona Inc.
last month to succeed David Meline, who planned to retire after about two years in the role of chief financial officer at Moderna. On Tuesday, Dentsply disclosed an ongoing financial investigation into certain matters, including financial reporting.
Mr. Meline will remain as chief financial officer while Moderna searches for Mr. Gomez’s permanent replacement.
The pandemic and ensuing economic recovery last year have increased the demand for finance executives, leading many companies to seek new leaders for their finance departments, according to recruiters. CFO turnover at S&P 500 companies rose to 18% last year, from 15% in 2020 and 14% in 2019, according to Russell Reynolds Associates, an executive search firm.
“There’s pressure on us to speed up the process, and we need to keep that pressure at bay,” said Peter Crist, president of Crist Kolder Associates, an executive search firm. “Managing expectations is our biggest challenge.” Crist Kolder was not involved in Moderna’s CFO search.
Strong competition for talent is leading some managers to shorten the hiring process and potentially favor candidates they already know, recruiters said. This can cause companies to take shortcuts in the due diligence process and overlook potential issues with a candidate.
Mr. Meline and Mr. Gomez both worked at General Motors Co.
between 1996 and 2005, during which time Mr. Meline, who started at the Detroit-based automaker in 1986, served as national and then regional chief financial officer.
Mr. Gomez held a variety of leadership and management positions at GM during this time. While he left in late 2005 to become Assistant Treasurer of Cardinal Health Inc.,
Mr. Meline joined 3M Co. in 2008 to become its Chief Financial Officer.
At Cardinal Health, Mr. Gomez rose through the ranks and became chief financial officer in 2018. He also met Don Casey, who served as general manager of the company’s medical segment and left in 2018 to take over. as Managing Director of Dentsply Sirona. Mr. Gomez was hired as Dentsply’s chief financial officer in 2019.
On April 19, Dentsply fired Mr. Casey shortly after the company announced Mr. Gomez’s departure on April 11. On the same day, he was named Moderna’s new chief financial officer. Mr. Gomez’s exit from Dentsply became effective May 6.
In response to a request for comment, Moderna pointed to its press release on Mr. Gomez’s exit, which did not address questions about the company’s recruitment process for the CFO position. The company added that it learned of the internal investigation Tuesday through Dentsply’s public record.
Mr. Gomez, Mr. Meline and Mr. Casey did not respond to requests for comment. Dentsply, asked to comment, referred to the company’s public filings and earnings call this week, which offer limited information about the investigation.
Recruitment firms and companies typically undertake a thorough vetting of potential hires, which involves reviewing publicly available information about a candidate, regulatory documents, and court records. Often, surveys and risk assessment companies like Kroll LLC help with these tasks.
Recruiters often rely on back-channel references, which may include members of the board of directors of the candidate’s current or former employer – particularly the audit chair – as well as external auditors, accountants, investment bankers and analysts, said Cathy Logue, head of the CFO practice. at Stanton Chase, a recruiting firm not involved in hiring Mr. Gomez.
But it can be difficult to get the full picture of the candidate from their current employer, said Josh Wimberley, founder of executive search firm LeadChange LLC, who was not involved in the CFO search at Moderna.
Current CFOs might be more limited in the information they can share, pointing out non-disclosure agreements and other stipulations that prohibit them from disclosing details about things like internal investigations or future earnings, recruiters said.
An internal investigation at a public company can be difficult to uncover, said Don McMurchy, chief executive of professional services firm RSR Partners, which was not involved in the search for Moderna’s chief financial officer. While it’s likely Mr. Gomez would have been asked to report any issues before his appointment to Moderna, he would have been limited in what he could share about another public company, Mr. McMurchy said.
Still, there were signs that something was wrong at Dentsply, said Peter Thies, president and co-founder of executive consulting firm The River Group LLC. Between the time Moderna announced the hiring of Mr. Gomez in April and his appointment as chief financial officer this week, the Dentsply chief had been ousted and at least two law firms – Ademi LLP and Pomerantz LLP – have sent out public alerts that they were investigating possible securities fraud at Dentsply. .
“What it looks like from the outside is that these events happened and they just let Gomez get to work,” Mr. Thies said. “Having it start and finish a day later, to me, is worse for a company’s reputation than saying Mr. Gomez won’t start his CFO term because there’s an ongoing investigation.”
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