Esearch jobs - The Road to the Corner Office

The New Rules of the Reference Game
By Anne Stuart

When it comes to job recommendations for upper-level finance and accounting professionals, things aren’t as simple as they used to be.

Richard Block, an adjunct professor of management accounting at Babson College in Wellesley, Mass., and a veteran finance executive, describes the traditional reference-gathering process this way: “You asked the candidate for references—usually three of them. You called those references. They usually said nice things about the person, which is what you expected. You made a checkmark on your list of things to do, and you had some sense of security that you’d done the obligatory reference check.”

Thanks to the massive accounting scandals that rocked the corporate world in recent years, that’s no longer enough.

“There’s a lot more on the line post-Sarbanes-Oxley,” says Block, referring to the stringent corporate financial-reporting requirements established by the federal Sarbanes-Oxley Act of 2002. “These days, that means that a far more robust effort should be made” in vetting any financial managers even remotely affiliated with efforts involving regulatory compliance, says Block, the ex-CFO of Avicon Group Inc. and former top finance executive for Digital Equipment Corp. and Intel Corp.

In fact, Block and other experts emphasize, both employers and individual finance and accounting professionals face growing levels of risk today. As a result, they say, both sides must exercise greater caution and due diligence than ever before.

Following is expert advice for helping both parties make smarter, safer hiring decisions:

Request more references. Companies should request—and finance and accounting professionals should be ready to supply—at least five to six references, Block says, calling the higher-than-traditional tally is particularly important for executive- and management-level positions. Of course, speaking with more references takes more time, but given the potentially high costs of hiring the wrong person, it’s typically well worth the investment. Talking to more references will almost certainly provide a clearer, more comprehensive portrait of a candidate—which typically benefits both sides.

Strive for a 360-degree view. Obviously, candidates should include at least one former supervisor among their references. However, incorporating other viewpoints will provide a richer, more multifaceted picture of any candidate. “Include one or more people who worked for you, as opposed to just people you worked for, and maybe a peer or two” says Block.

Meanwhile, don’t forget your colleagues or teammates in other departments, advises Lynne Sarikas, a former finance professional who now directs the MBA Career Center at Northeastern University in Boston. “You might include someone that you collaborated with from, say, marketing or IT,” she says. “That provides a much broader perspective.”

For a senior position, Block also recommends at least one “outside” reference: “This could be an external corporate counsel or a director or a venture capitalist or a banker—someone who had a professional relationship with you in the type of job you’re talking about.”

Go deep. Certainly, candidates should provide references who can talk knowledgeably about their accounting and management skills—but today, it’s equally critical to include people who can attest to important personal characteristics as well. “Make sure you have references who can speak about integrity and ethics,” Sarikas says. “People may not have explicitly focused on those areas in the past, but they are absolutely front and center today.”

In addition, Block says, both sides should be prepared for full disclosure. From the employer side, he recommends having any candidate for a top, or especially sensitive, finance or accounting position sign a statement allowing an outside company to conduct an extensive background check. Meanwhile, candidates should be prepared to discuss any possible problems—such as lawsuits or arrests—that an investigation might uncover, and both sides should keep in mind that even the best investigators make mistakes. Block recalls that in one of his past jobs, a top official at his company underwent a background check as part of a financing agreement. “They found someone with the same name in the same state being sued for failing to pay property taxes on a vacation home,” Block says. Happily, the transgression turned out to involve a case of mistaken identity, but it remains a valuable example of the kind of problem that might surface and require explanation.

Prepare to talk. Candidates should tell their references in detail about each job they’re pursuing so that they’re as prepared as possible for those reference calls. “References can be additional salespeople on your behalf, but they can’t do that effectively if you haven’t prepared them,” says Sarikas, of Northeastern University. “They’re going to do a much better job for you if you brief them on what kind of position you’re going for and what kind of help you’re seeking.”

Liz Lynch, a finance professional who heads the Center for Networking Excellence in New York City, couldn’t agree more. “When someone asks me to give them a reference, I always ask, ‘Is there something specific you would like me to focus on?’” says Lynch, who previously held financial management positions at Disney/TouchstonePictures, Goldman Sachs, Booz-Allen & Hamilton and Time Inc. “That way, it’s not a cold call, and I can speak in specifics, not generalities.” When she’s been on the hiring side, she turns the tables, asking candidates for background on the references they provide. “I ask why that person is relevant to them, what projects I should ask about,” she explains. Talking to a candidate’s past supervisors and co-workers about specific projects can provide a valuable reality check into whether candidates are inflating or embellishing the roles they played in those past key initiatives, she says.

Keep in touch. Call, e-mail or get together with your references occasionally even when you’re happy where you are; that helps prevent the perception that you only contact them when you want something. If it’s been awhile since you’ve worked together, bring past supervisors and colleagues up to date on what you’ve done in the interim. One easy way to keep tabs on potential references—and to let them keep tabs on you: Use a professional networking site like LinkedIn (www.linkedin.com) or Plaxo (www.plaxo.com) to build and maintain your own web of business contacts. “That way, you can keep track of people you worked with in the past and extend those relationships online,” Lynch says.