When the CFO Gets Fired...

A few years ago, in the middle of a Friday afternoon, a colleague in the field texted me: “OMG!!! Our CFO is getting fired live.” Later that week, she recounted the entire scene during our happy hour. Whoever invented the glass-walled office clearly didn’t anticipate it becoming a fishbowl of corporate drama, visible to everyone on the floor. “We just watched him pacing frantically, shouting at the HR officer,” she said. Wild gestures, grabbing papers, pointing fingers—all to no avail, as everyone knew what was coming. He had made a series of disastrous decisions, with the final blow being his FX hedge gone spectacularly wrong. Instead of reducing risk, he compounded it, leaving the company dangerously exposed to currency fluctuations.

Financial Biases and the Root of Hubris

I often think of this story when starting a new project. In my finance studies, I encountered influential figures like Daniel Kahneman and the insights of behavioral economics. The CFA Institute encapsulates it well: some biases in financial decision-making can be corrected through education, but others are part of human nature. Overconfidence, herd mentality, and the framing effect are not just for Cryptobros; they also affect seasoned professionals in subtle ways, making them harder to address. There will never be a license in self-awareness to reduce hubris by 75%. But after a decade of building data pipelines and dashboards for key decision-makers, I’ve learned a few tricks.

Case Breakdown 1: The Promoted Accountant-CFO

I’ve worked with many CFOs, and a surprising number didn’t come from financial backgrounds. Most started as accountants and climbed the corporate ladder. While precise and compliant, they often carry biases rooted in their accounting mindset. This often results in a focus on control and operations, not strategic risk management. I recently heard a CFO say, “But I don’t have any FX risk! Each month I transfer all the cash from USD to CAD to clear the balance.” Oh well…

The right approach here is to help them leverage their network by providing ready-to-use reports they can share with, for instance, a broker. The goal isn’t to teach them new concepts but to enable them to ask the right questions to the right professionals with the right data at hand.

Case Breakdown 2: Professional Investors and the Competitive Trap

Even seasoned investors with qualifications and experience aren’t immune to bias. Many operate in competitive, high-pressure environments where traders manage their own book, such as in M&A or consulting firms that cultivate stars competing for the same market and resources. While independence encourages accountability and creativity, it also creates friction—partners may withhold information, prioritizing their own performance over the collective portfolio’s success. This dynamic shifts systemic risk to the CEO, who must manage portfolio risks while fostering the success of star performers.

Changing this culture is nearly impossible. One solution is to provide top management with reporting systems that aggregate data from every source, ensuring full transparency at every level. I’ve seen such projects culminate with the hiring of a dedicated risk manager to ensure that stars don’t end up working against each other.

The Value of Humility

In ancient Greek thought, humility meant acknowledging that strengths come with limitations. Hubris arose when flaws were ignored, leading to downfall. True honor came from accepting one’s fate and using one’s gifts for the community’s benefit. In today’s world, this translates to accepting inherent biases and working with them. People don’t need lectures—they need assistance. Often, that assistance is simply ensuring the right information reaches the right person at the right moment.