We'd never hire a CFO who didn't know GAAP. Where's the GAAP for CEOs?

Imagine the following scenario.

Your board has just appointed a new CFO. She’s a math prodigy with degrees from MIT and Stanford. On top of that, she’s got a great personality: driven, analytical, and works well with others.

There’s just one catch. She’s never heard of Generally Accepted Accounting Principles, a.k.a. GAAP.

She’s not familiar with balance sheets. Or cash flow statements. Or how revenue is recognized. She’s never made a chart of accounts.

But the board seems unbothered. They tell you she’s smart. Give her a year or two and she’ll have cobbled together a system for tracking the company’s finances. It might even work.

By now you see the absurdity. No board would hire that CFO.

Yet this is precisely what we do almost every time we appoint a first-time CEO. Those new CEOs have no systematic understanding of the role, no codified way to approach its details and duties.

Instead of finding someone who understands the CEO role – or offering immediate training on it - the board sends o…