As the leader of a business dealing with changing scenarios comes as second nature to CEOs, and 2009 was particularly testing. Whether it was dealing with the results of the financial crisis or battling the fallout of bonus culture, CEOs continually on the ropes. Concurrently, the rise of technology and environmental issues, and the required specialist knowledge, meant new skills had to be learned. Director’s Eric Baker talked with Christopher Clarke, worldwide CEO and president of Boyden recruitment, to gauge what’s expected of a modern CEO.
Christopher Clarke knows what he does is worthwhile. As he puts it to new search professionals: “The work we do is good for humanity. We find leaders for companies, these companies create employment and help the communities’ people live in. Do not get arrogant.”
The main challenge he runs up against is 98% of senior management want to stay in their home country. “Anybody who aspires to a CEO position in a multinational company has to have experience in an international setting. They need to know Europe, Asia, and the United States, as they need to know different cultures.
“We all put down on our preference sheets that we are willing to live abroad. But the day you say to your partner that you are going to a post abroad, things change. All kinds of difficulties arise.
“In addition, it has become very expensive to post expats abroad. It requires more than a six-month commitment, and you need really good local people. You have to make sure when you send people over there they learn, so you have to guard against people being put in a bubble when they post abroad.”
Senior executive recruitment takes a different tack from typical employment agencies as they generally take a brief from a client and advise on what type of person they would need based on cultural fit.
“For example, you could have a banking position available. But investment banking and regular banking are two very different cultures, so you wouldn’t want to stick someone from one field into the other without any experience.”
Firms use highly trained research analysts to scour for proper fits within the industry. When the right candidate is found, they are approached and the position is discussed.
“You have to understand what is going to really excite them. Usually candidates are interested in making a difference, being able to learn from a challenge, and being able to contribute in terms of corporate social responsibility and caring for the environment.
“If a candidate starts talking about money right away, that is usually a red flag. Compensation is important, but they should have other goals as well.”
The economic downturn was felt worldwide but it remains particularly damaging for the United States, and that has bred a culture favouring corporate governance and limited bonuses. Clarke believes bonuses can still play a role in Asian remuneration schemes, so long as they serve a purpose.
“In banking, many base salaries are quite small and bonuses are a part of the normal salary package. But bonuses can be an incentive for risky behaviour, so you have to design them in the right manner. If the stock market rises, and your company’s stock rises as well, you shouldn’t be compensated for that. You should be remunerated by showing comparable change to other companies.”
But in Asia, because of the 1997 financial crisis and other recent bubbles, he believes compensation schemes are more prudent.
Corporate social responsibility and environmental awareness has almost become a requirement with companies searching for executives. “An interesting thing has happened with social responsibility. It started off as something largely cosmetic to appeal to the public, but now it has turned into something very real. And this is not a bad thing at all, as every company now lists social responsibility as a concern.”
Looking ahead, Clarke sees a right future for Asian economies. BRIC countries (Brazil, Russia, India and China) are becoming the new centres of consumption, as the US and UK continue to live on credit. “China now owns so much American debt it has become a partner with the US.”
Of course, business will go where there are cost opportunities, and much of Asia is still considered low-cost. Those countries need to build up their expertise and skills, he said.
The Association of South East Asian Nations (ASEAN) is also adapting as more people move around the region for jobs. “Culturally, the nuclear family has been around for a long time. My grandfather was born and died within a few kilometers of the same place, and changing that culture is hard. But education is changing all that as parents increasingly send their children abroad for school. Once people start moving, they realize they can succeed in many settings.”
Education is important for candidates looking for corporate-level positions, but there is room for mavericks as well. “There will always be entrepreneurs who are radically different that the cultured classes, the same with artists, and history is littered with examples. Multinational companies may be started by these people, but they are subsequently run by those with high levels of education, so it remains an important factor.”
Another tip from Clarke on becoming a successful candidate is to volunteer and stick to the commitment. Because an international move is such a large undertaking, many people back out. But an international move can be good for the whole family, he said, and is essential for executive to gain experience.
CEOs also need to be technically proficient. Younger generations tend to catch on to technology much quicker, so a smart candidate will surround himself or herself with capable staff.
“It makes your job easier if you surround yourself with people who are good at what you aren’t.
Reprinted with permission