Firms with poor recent stock performance are more likely to appoint their CFO to the board and the private information associated with this choice is associated with greater leverage, cash holdings and lower payout likelihood. However, adding the CFO to the board is associated with subsequent decreases in leverage, greater financial flexibility and less financial constraints as evident in faster adjustment toward target debt ratios, decreased levels of cash holdings that are also less sensitive to cash flow and a greater likelihood of share repurchases. Better financial management also leads to better operating performance for these firms, once the CFO is on the board. These findings are based on several different methods that control for the endogenous choice by firms to put their CFO on the board. Finally, internal financial expertise can benefit shareholders as evident by the positive market reaction to the news of an internal financial expert’s appointment to their board. Thus, increasing the CFO’s influence by putting them on the board can be a key strategic initiative for many firms to improve operating performance and to deter unwanted takeovers while the stock price is low. These findings are especially important in the post-Sarbanes-Oxley era when firms are mandated to increase board outside financial expertise and, at least implicitly, forced to reduce the role of internal financial expertise on their boards.