Table of Contents
01
Key findings
02
Focus on the fundamentals
03
Prioritize performance
04
Be exit-ready
05
The 2025 sponsor-CFO flight plan
Survey Report 2025

The state of the PE sponsor & CFO relationship

PE sponsors to portfolio CFOs:

“You’re not meeting the value creation moment.”

Three-quarters of sponsors say their portfo­lio company CFOs are underperforming. It’s an alarming stat, but consistent with findings from our previous surveys.

This year, however, the reasons behind this underperfor­mance have shifted dramatically.

PE sponsors do not feel that their portfolio CFOs are driving the kind of value creation and protection required by a constrained multiples environment that’s now been further upended by tariff uncertainty and recessionary fears.

74%
of sponsors
say their portfolio company CFOs aren’t meeting expectations

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01

The fundamentals

CFOs are not meeting the “minimal safe altitude” for piloting the finance function at PE-backed companies (and they know it).

“PE-backed CFOs are not meeting sponsor expectations.”
SPONSORS
CFOS

What they don’t seem to understand is why. CFOs believe they are perceived to be falling down on the “plus” parts of the position—the responsibilities that extend into a more strategic and tech-enabled definition of the role. And while these “plus” parts may be lacking, they are not the CFOs’ fundamental flaw—that flaw is foundational.

How are CFOs underperforming?
Why it matters

In a potentially recessionary market with lower (or, at least, non-expanding) multiples, every dollar left on the table is a missed opportunity. As a result, sponsors want their CFOs to uncover pockets of previously “hidden” value. This means that processes which would have otherwise been considered “good enough” in a multiple arbitrage environment must now be scrutinized under a microscope for any potential efficiency gains or improvements. That’s why sponsors expect their CFOs to start with the basics. They understand that shaving even a day or two off an elongated close process can unlock hidden value. Similarly, sponsors know that there’s gold to be found by imple­menting delayed integrations. Serial acquirers, having been too busy biting to finish chewing, should now see unrealized synergies from already-com­pleted deals as the ultimate reservoir of hidden value. Once they’ve perfect­ed these basics, sponsors believe that the CFO should rightfully turn their attention to more impactful value creation levers.

Why it matters

This “focus on the fundamentals” theme extends to what PE-backed CFOs should consider their finance function priorities for 2025. Sponsors say that in this era of constrained multiples and recessionary fears, they need their CFOs to drive and protect value using PE’s primary levers: improved working capital and reduced costs.

What should CFOs be focused on in 2025?

Given all the unmet expectations, it should come as no surprise that roughly 8 in 10 CFOs continue to be con­cerned about job security.

77%
of portfolio CFOs
are concerned about job security
Expert Analysis

The role of the PE-backed CFO has always been a volatile one: the rate of turnover on the position has hovered around 75%-80%. Couple that stat with the fact that the average tenure of corporate CFOs is now on the downswing, and PE-backed CFOs have a right to be concerned about their job. In fact, one PE partner anecdotally noted that not a single one of his portfolio companies had retained their CFO post-deal.

But it’s important to point out that while 77% of CFOs are concerned about job security, that number has decreased from 87% in our 2021 survey and (a record) 91% in our 2023 survey.

What’s changed? First, we appear to be inching back to the default baseline from the pre-COVID era, (in our 2019 survey, 66% of CFOs reported concern about job security). Second, more CFOs seem to understand that demand for competent, experienced finance executives is outstripping supply. The tight job market is being exacerbated by delayed portfolio company exits, early retirements and cash-outs, a lack of younger accounting professionals to act as ready successors, and the growing availability of opportunities for CFOs beyond the finance function.

02

Performance

Here’s what everyone knows: Performance is critical when multiples stop expanding. However, sponsors believe CFOs aren’t as focused on the value creation horizon as they need to be.

Message from sponsors: improve value creation

That’s a concerning, if perhaps overly generalized, stat that would benefit from more detailed investigation into where CFOs are falling short.

There are, broadly, five discrete lenses through which a CFO can drive value creation:

The financial lens

The financial lens identifies hidden opportunities to improve working capital efficiency by analyzing key revenue sources and assessing the performance of direct and indirect costs (including SG&A).

Sub-modules:

This lens takes a magnifying glass to financial factors including:

  • Revenue growth
  • Revenue leakage
  • Indirect/SG&A cost margins
  • Working capital (DSO, DPO, DIO)
  • CapEx ROI
  • Direct cost margins
The process lens

This lens identifies ways the portfolio company can streamline processes through simplification, standardization, and/or automation.

Sub-modules:

This lens takes a magnifying glass to processes including:

  • Lead to order
  • Procure to pay
  • Order to cash
  • Plan to deliver
  • Record to report
The operational lens

This lens identifies ways to drive operational performance improvement specific to the company’s unique industry and sector, such as improving service standards, streamlining the supply chain, enhancing product quality/reliability, revenue per user, and more.

Sub-modules:

This lens takes a magnifying glass to operational levers including:

  • Production efficiency and effectiveness (labor, inventory)
  • Vendor base (lead times, delivery)
  • Sourcing (materials, services)
  • SKU profitability
  • Sales and marketing effectiveness
The digital lens

This lens identifies ways to increase EBITDA through enterprise-wide digital enablement, process automation, and building/buying a fit-for-purpose technology stack.

Sub-modules:

This lens takes a magnifying glass to digital variables including:

  • Technology cost (licensing and support)
  • Enterprise application stack
  • Data quality and infrastructure
The organizational lens

This lens finds opportunities to drive efficiencies through simplifying and de-layering the company organizational model.

Sub-modules:

This lens takes a magnifying glass to organizational models including:

  • FTE efficiency
  • Span of control
  • Location strategy
  • Sourcing model (captive vs. third-party)

Sponsors believe that their portfolio CFOs have been somewhat effective at driving value through digital, working capital, and liquidity lenses. Going forward, particularly given the tariff landscape and recession fears, they would like them to focus more on operational and process levers, while still doubling-down on digital.

On which value creation levers should CFOs focus?
Why it matters

The CFO-sponsor alignment around focusing on operational and process lenses isn’t surprising given the need for levers to mitigate Trump tariff policies and a potential recession.

What’s more notable is where there is slight misalignment. Spon­sors want CFOs to double-down on digital initiatives. CFOs, on the other hand, believe they have already effectively tapped the digital well and the remaining squeeze may not be worth the juice.

What CFOs may not be accounting for here, are the newly emerg­ing digital tools at their disposal (like AI/GenAI’s impact on fi­nance functionality). Indeed, the digital lens will never be “done.” The nature of technology means constant innovation which forces the continued evaluation of the technology that underlies compa­ny operations. For that reason, it makes sense that sponsors want their CFOs to double-down on digital levers.

Why it matters

But let’s be clear, identifying and pulling these independent value creation levers is about more than just individual portfolio company performance, as is the sponsor focus on the digital lens. It’s also about fundraising. In a market marked by limited returns to investors, funds are finding it more important than ever to communicate to LPs what value creation levers they will pull in order to accelerate returns.

When their portfolio CFOs are implementing emerging digital measures (like AI), it makes for not only improved performance, but a great, buzzword-heavy LP pitch.

95%
of sponsors say
that it’s more important than ever before to communicate to LPs the value creation levers being pulled across their portfolio
03

Exit readiness

Waiting for the perfect time to sell a PE-owned company is over. LP patience for returns is wearing thin, and sponsors’ coffers are full of dry powder. Sponsors are also ready to divest non-core assets to gain additional liquidity to weather any recessionary storms ahead. What does that mean for the market? We are likely to soon emerge from a period of record-low deal activity into a buyer’s market with a logjam of assets in play—even if conditions aren’t ideal.

But while the market may dictate an early landing, CFOs have not necessarily located the exit door.

Message from sponsors: Get exit ready

CFOs have not effectively developed a more holistic sell-side readiness program to get their not-necessarily-primetime-ready company prepped for sale on an accelerated schedule. Holistic exit readiness would require that CFOs engage in activities beyond traditional sell-side programs. And that’s something CFOs have not been particularly effective at doing.

Why do sponsors say portfolio CFOs are not exit ready?

They’re too focused on revenue growth, not focused enough on acquisition integration
They focus on value creation at the expense of sell-side readiness, leading to rushed preparation
They have not rationalized tech platforms effectively, leaving disparate systems unoptimized
They haven’t created a roadmap for future buyer value creation with in-play initiatives
They haven’t harmonized finance and operational metrics to craft an equity story
Why it matters

In order to meet sponsor expectations, CFOs will need to engage in a more unconventional and accelerated sell-side readiness program that involves:

  • Moving away from a linear process of value creation followed by exit preparedness, instead undertaking sell-side readiness and value creation in tandem.
  • Focusing on postponed integrations to find the not-yet-realized value from incomplete acquisition integrations.
  • Building a roadmap of future value that enables transaction conversations that are about the last mile under current ownership and, just as important, the first mile under new ownership.
Why it matters

The root cause of this exit-unreadiness is a mindset misalignment. Given the urgency for exit, and the need to take deal opportunities when they come, sponsors want their CFOs to focus on holistic exit readiness throughout their tenure. They want them to operate as if the company is always for sale. CFOs, on the other hand, have been trained to think in terms of 3–5-year hold periods. As such, they aren’t necessarily ready to think about the end at the beginning of their tenure.

Message from sponsors: Stay exit ready

There’s also a second area of misalignment around what exactly should serve as the CFO’s north star.

CFOs believe that their sponsors want them to focus on meeting year- end performance metrics above all else. But that’s not what sponsors want—they would prefer that their portfolio CFOs prioritize equity value, even if it means sacrificing yearly budget-meeting magic.

Message from sponsors: Prioritize equity value
EXPERT ANALYSIS

The role of the PE-backed CFO is more complex than ever. But at the end of the day, sponsors will measure CFO success by their ability to meet the target for exit as quickly as possible. That will often mean trading short-term profitability for long-term gains. And it will almost always mean getting comfortable spending some sizable money.

Good CFOs will act on equity-driving investments when prompted by their sponsor. Great CFOs will be proactive, identifying and championing those equity-driving initiatives they believe are critical (whether through organic growth or M&A), and pushing their sponsor to align with and prioritize them. While spending money might seem heretical to a CFO who lives by a cost control mantra, PE-backed CFOs must remember they’re a different breed. Their job is to make the investments that will have a high ROI and pay returns by exit (not year-end).

The BFD:
The 2025 sponsor-CFO flight plan

Private equity firms are in a very different market than they’ve been in during previous iterations of this survey—one in which they can no longer rely on ever-expanding multiples.

It’s therefore no surprise that sponsors are demanding their portfolio CFOs start fixating on performance. They want their CFOs to identify every hidden value creation opportunity. Of course, this includes the real needle-moving levers, like tech-enabling the function, leveraging predictive analytics, and marrying operational and financial data for more dynamic forecasting. But sponsors also know that to reach those needle-moving levers, their CFOs need to perfect the basics.

CFOs haven’t perfected these basics or met the moment.

They haven’t (yet) looked under every nook and cranny of every process and workflow to unlock the kind of hidden EBITDA that will drive valuation (or protect value if recessionary fears prove true). It’s time for PE-backed CFOs to relentlessly pursue cost optimization and margin expansion. Doing so effectively will mean clawing back all the money left on the table from elongated close processes and other inefficient FP&A workstreams. It will mean thinking beyond macroeconomic drivers and using all the financial, organizational, process-centric, and digital levers at their disposal to uncover each and every pocket of buried value. Finally, it will also mean leaning into operational levers that have not traditionally been under the CFO’s jurisdiction in order to mitigate the impact of tariffs.

Given these unmet expectations, we hope this survey report can serve as a 2025 “flight plan” for both PE sponsors and their portfolio CFOs. The plan encourages CFOs to use the next few months to proactively articulate their value creation strategies for unearthing hidden EBITDA, while tackling sell-side readiness initiatives in tandem with pulling performance enhancement levers.

For sponsors, the flight plan encourages them to give their portfolio CFOs permission—and perhaps even compensatory reinforcement— to make equity value their ultimate north star. And for both parties, it provides the insights they need to bridge misalignment, navigate tariff and recessionary turbulence, and build a lasting partnership to drive value creation.

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About Accordion

Accordion sits at the heart of private equity—where sponsors and CFOs meet. Through financial consulting rooted in data, technology, and AI, we help clients drive value. Our services support the Office of the CFO across all stages of the investment lifecycle—including foundational accounting, strategic financial planning and analysis enhancement, CFO-led performance, transaction support, and turnaround and restructuring solutions. Accordion is headquartered in New York with ten offices around the globe. 

Survey Methodology

The State of the PE Sponsor & CFO Relationship survey was conduct­ed by Accordion, in conjunction with Wakefield Research, among 400 total participants—including 200 private equity (PE) sponsors (senior exec­utives) and 200 chief financial offi­cers (CFOs) at private equity-backed companies with $50 million or more in annual revenue. The CFO and PE sponsor samples were collected/finalized in April 2025, using an email invitation and an online survey. for clients, with services supporting the Office of the CFO across all stages of the investment lifecycle