22 July, 2012
The hiring of older, more experienced workers for global executive jobs is likely to increase in the coming year in India, as companies are wagering that these more seasoned leaders will be better equipped to weather the continuing repercussions of the global economic crisis.
"Senior executives have seen ups and downs of the market and know what it takes to come out of a tough market when everything, including consumer confidence, market conditions, inflation pressures, governance, and international scenarios seem to be going against the industry. Hence seniors with long tenure of service experience are preferred," EWS Search Executive Director Perry Madan told The Indian Express.
One executive search expert projected that the hiring of “grey hairs” for senior executive roles in India is likely to grow by 12% this year. "Earlier, to gain edge over competitors or to boost the top line companies would take unimaginable risks,” said Vinay Grover, Chief Executive at Symbiosis Management Consultants. “Now that is thought of the past and to bring a balance to their aggressive postures men with 'grey hair' or experience are warranted."
The general perception is that senior executives are more risk-averse, and better able to multitask and take on multiple roles with greater ease than their younger counterparts. "The trend of hiring experienced people started during 2008-2009 post-recession after the financial markets were in turmoil and was visible across sectors," said Grover. Deepti Yogi of Elixir Consulting AVP agrees: "The trend has been there for some time and hiring of grey hair has been increasing by 15-20 percent every year," she said.
This executive hiring trend is most evident in the banking and financial sectors, followed by steel, engineering, infrastructure, energy and real estate. As it increases, the practice is also taking hold in the manufacturing and automotive industries. "This trend may catch up with other sectors like BFSI, pharmaceuticals and technology as well," Yogi added.
Older executives may also be attractive to Indian companies due to the country’s high level of corruption. INDOlink reported that, according to an Ernst & Young (E&Y) survey, 28% of top executives in India consider bribery and cash payments acceptable as a means of obtaining and retaining business.
This poses significant risks for companies with business interests in rapidly developing India, and the situation is starting to be addressed. "As domestic enforcement activity is building strength, increased focus on mitigating frauds, bribery and corruption risk has been matched by growing regulatory activity, enhanced media activism and more severe penalties," said Arpinder Singh, E&Y India Partner and National Director for Fraud Investigation & Dispute Services.
Another strategy is to put in place more experienced executives who are better able to wage this battle. Singh said, "As against a global average of 50 percent, in the country over 70 percent of respondents think that the boards need a more detailed understanding of the business to function as an effective safeguard against fraud, bribery and corruption risks."