Nike’s rich CFO hire shows the price of turnaround talent

Nike is paying heavily to bring in a veteran finance chief as the company works through a difficult turnaround. Fortune reported that the hiring of David M. Denton reflects a broader market in which companies are spending more to recruit proven public-company CFOs.

Nike said on June 23 that Denton will become executive vice president and chief financial officer on Aug. 17. The company said current CFO Matthew Friend will step down at that time and remain with Nike through Sept. 4.

Denton is joining from Pfizer, where he has served as CFO, according to Nike and Fortune. He previously held the same role at Lowe’s and spent about two decades at CVS Health, including a stint as CFO.

Shawn Cole, president and co-founder of executive search firm Cowen Partners, told Fortune that experienced CFOs with public-company backgrounds are in short supply, especially for companies trying to improve performance. Cole said Nike is a recent example of employers using large upfront packages to attract finance leaders away from other companies.

An SEC filing cited by Fortune shows Denton’s package includes a $7.25 million cash award tied to compensation he is leaving behind at Pfizer. Fortune also reported that the package includes a $1.45 million base salary, an $11.5 million fiscal 2027 long-term incentive target and a separate $4 million performance award that vests later.

Cole told Fortune that Denton’s experience across health care, retail and consumer-facing companies should be useful to Nike as it refines its strategy. He also said the market for such executives is tightening because about one-quarter of sitting CFOs are within five years of retirement.

Nike CEO Elliott Hill said in the company’s announcement that Denton has experience helping consumer brands operate with financial discipline while investing for growth. Denton said in the announcement that he plans to support Nike’s priorities, invest carefully and help create long-term value.

The appointment comes as Nike’s turnaround remains uneven. Fortune’s Phil Wahba reported that Nike’s most recent quarterly results, released June 30, showed revenue little changed at about $11.3 billion, another decline in gross margin and earnings per share that topped Wall Street’s expectations.

Wahba wrote for Fortune that Nike’s challenges include reduced financial disclosures and strategy issues in China, running, Converse and marketing. He reported that those problems are complicating Hill’s effort to revive the company and raising risk for shareholders.

Fortune’s report framed Denton’s hiring as a test of whether a costly CFO recruit can help turn a fragile recovery into a more durable one. For Nike, the price tag shows how much companies may be willing to spend when they want a finance chief with experience handling large public businesses.

This story draws on original reporting from Fortune.