Decoding corporate development leadership titles: VP, SVP and CDO

Strong corporate development teams are the cornerstone of an organization’s inorganic growth strategy, but it’s not always clear when you should hire a vice president, senior vice president or chief development officer (CDO) to lead the charge.

Each of these titles entails a different tier of responsibility, which often correlates with the hiring organization’s size and strategic M&A plan. And while you shouldn’t place too much emphasis on the exact title (e.g., “overtitling”), the connotation behind each M&A leadership role is important to your company’s image and your new hire’s scope of responsibility.

In this article, we’ll explain:

1. What these titles mean
2. How their responsibilities differ
3. When to hire one versus another

But first, you might be wondering why we’re examining only vice president and C-suite titles. What about heads of corporate development, corporate development managers and all the other variations of senior corporate development leadership titles?

Every organization has a slightly different interpretation of these roles. We’re using vice president of corporate development, senior vice president of corporate development and CDO as generic titles intended to represent different tiers of corporate development leadership; note that exact titles may vary by organization.

So, what do these titles mean, and how do they differ?

1. Vice President of Corporate Development: This person will generally serve as an individual contributor within a lower-middle or middle-middle market organization. These individuals are “full stack” M&A professionals, meaning they can source, model and run diligence on deals. More often than not, these individuals also lead negotiations, but that can depend on experience level and investor efforts. Typically, these individuals report to the CEO and have no integration responsibilities.
2. Senior Vice President of Corporate Development: A senior vice president plays a similar role to a vice president but typically operates within a larger and more complicated organization with multiple products and multiple service lines. This distinction means these individuals must play a broader role in strategic planning, and they typically manage a team of 3-7 people that finds and closes deals but will not run post-close integration.
3. Chief Development Officer: This C-suite version of a corporate development president oversees much more than M&A. Typically, the CDO will lead all aspects of inorganic growth, including sourcing, execution and integration, as well as overseeing several additional functions of the business. For example, a CDO serving within a private equity-backed healthcare organization will likely play a role in payor contracting, physician recruitment and strategic planning in addition to M&A.

Related: Three coveted profiles in corporate development

Now that we’ve defined the role and responsibilities for each of these titles, you still may be wondering which is best for your organization. There are two questions you must ask yourself:

1. How much are you willing to spend? Put simply, higher titles require higher salaries. If you’re adding corporate development talent to your lower-middle market company, budgetary restrictions will likely leave you hunting for a vice president instead of a senior vice president. If your budget allows for a more senior leader and your company needs someone to head a small team, adding a senior vice president could be worth the cost.
2. Does your organization have needs beyond M&A? Making the jump from vice president to senior vice president to CDO also depends on how wide of a scope your organization needs this person to have. If M&A plays a central role in your investment philosophy and you have an operational and strategic need in your C-suite, it could be more cost effective to hire a CDO who can play a more diverse leadership role on your team. The best corporate development leaders can bring value to every corner of your organization.

The choice between hiring a vice president, senior vice president or CDO for your corporate development team depends on your organization’s size, budget and leadership needs. While specific titles may vary, understanding the nuances behind these general roles is essential for shaping your company’s strategy and the scope of your new hire’s duties, ensuring they can effectively contribute to your inorganic growth initiatives.

To learn more about our recruiting capabilities within corporate development, contact Josh Kotelnicki at (336) 217-9159 or josh.kotelnicki@charlesaris.com.