Why Business Leadership Needs a “Driver’s License”

In my work as an interim manager during transformation and restructuring phases, I repeatedly encounter a structural pattern: Highly qualified executives take on executive management roles without having a solid foundation in financial management, liability mitigation, and governance.

A Real-World Example

A medium-sized technology company in the mechanical and plant engineering sector, internationally successful and a technological market leader in its niche.

A new managing director takes on his first executive position—technically excellent, motivated, and enjoying the full confidence of the shareholders.

To bridge a vacancy in the commercial department, I was brought in as an interim manager. The mandate was clear: stabilization, analysis, and support during a transition phase. The establishment of an expanded reporting system for stakeholders.

As part of my mandate, I analyzed the company’s financial and controlling data. This revealed a different picture than external perceptions would suggest. Liquidity trends, margin trends, project evaluations, and

working capital structures all showed clear early warning signs of an emerging corporate crisis.

Nothing dramatic. But also nothing that could be ignored.

External Pressure and Internal Reluctance

Added to this was considerable pressure to meet expectations from a financially strong shareholder with a private-equity background. The focus was clearly on growth, performance, and return targets. A systematic examination of structural risks was initially viewed as too defensive.

In numerous discussions with management and the governing bodies, it became clear that adapted financial systems, risk management, and liability-related aspects had not been the center of attention up to that point.

Why Professional Expertise Alone Is Not Enough

The transition to an executive leadership role follows different principles than operational management. Suddenly, the focus is no longer on personal performance, but on system control, risk management, decision-making frameworks, and legal safeguards.

In my work as CFO and CRO on restructuring and turnaround assignments, one thing becomes clear time and again: A company’s true condition can only be assessed through a thorough, in-depth financial analysis—not through superficial reporting.

The term “liability” is a wake-up call. And that’s a good thing. Avoiding liability starts with thorough analysis, realistic assessments, documented decisions, and transparent communication with shareholders and supervisory boards—but also with your own team, using the right words and content.

The Missing Driver’s License

Hardly anyone would drive a vehicle without a driver’s license; after all, the law requires one. In corporate management, people take on responsibility for significant assets, employees, and personal liability risks—without any formal preparation for this specific role.

There is no legally required “driver’s license” for corporate leaders. But in practice, one is needed. Those who have a precise understanding of their company’s status, identify risks early, and document decisions thoroughly lead with greater composure, clarity, and confidence.