Retained Search Firm Diversity Video

Retained Search Firm Diversity Video

Retained Search Firm Diversity Video

It is reasonable to wonder whether the lack of retained search firm diversity has a bearing on the diversity of the senior executives and board members that they recruit.  That’s what I talk about in our latest video, a follow-on to my recent blog post Search Firm Diversity Impact on Executive Hires. In that post, I featured a table detailing retained search firm diversity. In the absence of self identification, we made educated guessed as to the gender and ethnic/racial diversity of those leading the most highly regarded retained executive search firms in the world.

Search FirmNameTitleGenderDiversity
Heidrick & StrugglesTracy R. WolstencroftChief Executive OfficerMaleWhite
Spencer StuartKevin M. ConnellyChief Executive OfficerMaleWhite
Russell ReynoldsClarke MurphyChief Executive OfficerMaleWhite
Korn FerryGary D. BurnisonChief Executive OfficerMaleWhite
DHR InternationalGeoff Hoffmann Chief Executive OfficerMaleWhite
Egon ZehnderRajeev VasudevaChief Executive OfficerMaleAsian
Witt/KiefferCharles W.B. Wardell, IIIChief Executive OfficerMaleWhite
Caldwell PartnersJohn N. WallaceChief Executive OfficerMaleWhite
Diversified SearchDale Elton JonesChief Executive OfficerMaleBlack/African-American
Stanton ChaseMickey MatthewsInternational Chairman
Managing Director
MaleWhite
BoydenTrina GordonPresident & CEOFemaleWhite
Herbert Mines AssociatesHal ReiterChairman & CEOMaleWhite
Slayton Search PartnersRichard SlaytonManaging Partner & CEOMaleWhite
Ferguson PartnersWilliam J. FergusonChairman & CEOMaleWhite
On PartnersTim ContiCo-Founder & Managing PartnerMaleWhite
JM SearchJohn C. MarshallChief Executive OfficerMale White
Morgan SamuelsBert HensleyChairman & CEOMaleWhite
Odgers BerndtsonRichard Boggis-RolfeChairmanMaleWhite
Allen AustinRob AndrewsChairman & CEOMaleWhite

Is Retained Search Firm Diversity Really the Problem?

Some well-meaning, enlightened retained search firm partners and hiring executives may be discriminating against those who do not resemble the power elite — which last I checked remains white and male. Moreover, common sense suggests there is likely a correlation between the lack of retained search diversity and the paucity of diverse candidates in the executive suite. However, it is crazy complicated.

Retained Search Firms Are Part of the Solution

Other data suggest that retained search firms are very much part of the solution. If it weren’t for them, they’d likely be fewer diverse candidate than the few we have at the senior executive and board level. Case in point? A study by the Silicon Valley law firm Fenwick & West entitledGender Diversity in Silicon Valley A Comparison of Silicon Valley Public Companies and Large Public Companies. On page 14, it goes on to report:

nominating committees and board members as a whole often start their search for board candidates by looking in their own networks of contacts (even if a professional search firm is also retained), and smaller companies often do not retain a professional search firm to find board candidates — reducing the chance that women will be represented in the candidate pool for some boards due to idiosyncratic network effects.

When You Check Your Network, Check Yourself

By depending their own networks — when one’s own networks tend to be homogenous — boards of directors are perpetuating the white male status quo. The utter irony is that they are perpetuating the status quo when the members of those boards are among the most politically progressive and enlightened leaders of the free world. I trust that the majority of the really do want diverse leadership.  Checking your own network for referrals is a natural impulse. It is fast, It is easy. You get pre-referenced candidates that speed through to hire. In so many ways, it makes sense. It is a senior level employee referral and employee referrals are among the most effective way to recruit, right? That’s what HR consultants advise. Yet by turning to our own networks, leaders are unwittingly discriminating against those who do not run in our same circles. It is a form of unconscious bias. Just when we thought we were evolved and become a better version of ourselves, unconscious bias comes back to bite us in the end.

Unconscious Bias Consciousness

Everyone has unconscious bias. It is what makes us human.  The trick is to become aware of that tendency and, as leaders, to check ourselves. We have the power, collectively, to fix this thing so all deserving candidates get a fair shot.  If we believe those who have worked hard to become the best of the best deserve the best opportunities, then let’s prove it.  If we believe in meritocracy, then check ourselves and and the companies we lead to make sure that all those who merit consideration really are considered. Let’s make sure the best person for the job really gets it — especially at the senior executive and board level.

What Retained Search has in Common with Mark Twain

What Retained Search has in Common with Mark Twain

Retained search fees are up 7 percent for the second quarter of 2013 compared to the same period a year ago. That statistic comes from the Association of Executive Search Consultants (AESC) survey of its members and is nearly 6 times the 1.2% rate of inflation. Search firms are focusing on the senior-most executive searches, leaving lower-level executive searches to in-house corporate recruiters and LinkedIn. In other words, retained executive search is moving increasingly upmarket.

However, since the downturn, a good many thought leaders have been predicting the downfall of traditional retained executive search. Consequently, for the past several years, retained executive search firms have had a great deal in common with Mark Twain. After learning that his obituary had been published in the newspaper,  Mr Twain is reported to have said, “The reports of my death are greatly exaggerated.” What Mr. Twain actually said — quite simply–was, ‘The report of my death was an exaggeration.”

Like Mark Twain, reports of the death of retained executive search have been greatly exaggerated:

How LinkedIn Killed The Recruiting Industry

The Destruction of the Head Hunting Industry

Without a doubt, LinkedIn has disintermediated executive search firms that have failed to distinguish themselves with a unique value proposition. But retained firms that make it a practice to stay ahead of the curve are benefiting handsomely from the seismic shift in executive search. More on that later . . .

The End of Men and Retained Search’s Patriarchy

The End of Men and Retained Search’s Patriarchy

This year, women become the majority in the workforce for the first time in American history. It is a critical milestone, one that we in executive search ought to pause to consider by reading an intriguing article in the Atlantic Monthly entitled “The End of Men”. The reason? 75% of the 8 million jobs lost in the recession were lost by men, as testosterone dominant blue collar and Wall Street jobs have gone the way of the dodo bird. At the same time men are having a tougher time getting by, women appear to be on the rise. One reason may be that companies that employ woman leaders are simply more profitable. (Do I have your attention yet?)

A 2008 study attempted to quantify the effect of this more-feminine management style. Researchers at Columbia Business School and the University of Maryland analyzed data on the top 1,500 U.S. companies from 1992 to 2006 to determine the relationship between firm performance and female participation in senior management. Firms that had women in top positions performed better . . .”

At a time when excessive risk nearly drove our global economy to its knees, studies also suggests that men may be hormonally inclined to make reckless mistakes. Ironically, women’s hormones — the very chemicals held against us for so long — appear to make us better decision-makers, especially in today’s economy.

Researchers have started looking into the relationship between testosterone and excessive risk, and wondering if groups of men,in some basic hormonal way, spur each other to make reckless decisions. The picture emerging is amirror image of the traditional gender map: men and markets on the side of the irrational and overemotional, and women on the side of the cool and levelheaded.

In fact, women’s recent majority win in the workforce may be just the beginning because women are graduating in higher numbers from college. “For every two men who will receive a B.A. this year, three women will do the same.” The article goes on to explain the implications:

IF YOU REALLY want to see where the world is headed, of course, looking at the current workforce can get you only so far. To see the future—of the workforce, the economy, and the culture—you need to spend some time at America’s colleges and professional schools, where a quiet revolution is under way. More than ever, college is the gateway to economic success, a necessary precondition for moving into the upper-middle class—and increasingly even the middle class. It’s this broad, striving middle class that defines our society. And demographically, we can see with absolute clarity that in the coming decades the middle class will be dominated by women.

The domination is also being expressed in gender selection at fertility clinics. Based on anecdotal evidence, parents seeking assistance in getting pregnant are choosing girls over boys three-fourths of the time. While that particular fact and the idea of women’s collective rise to power may be shocking to some, it is yesterday’s news to my teenage daughter and others her age raised on a steady diet of girl power videos from artists that include Beyonce who tours with an all-female band. In song after song (Irreplaceable, If I Were a Boy, and her earlier Destiny Child’s Survivor), she conveys that rather than being worthless or worth less than men, we of the female persuasion are actually worth something — at the very least, a ring.

 

Beyonce’s Single Ladies (Put A Ring On It) begat a flash mob in Piccadilly Circus in London . . .

 

. . . and morphed into a gay power subplot on the Fox show Glee . . .

 

If Justin Timberlake feels secure enough in his manhood to don a leotard and high heels in a Single Ladies send-up, then perhaps we have, indeed, arrived. However, the major retained search firms yet to come to that realization when you examine the percentage of women they employ. I actually stopped and counted the women listed at each of the U.S. offices. The unofficial tally is as follows:

  • Korn Ferry: SeniorLeadership: 20% women – 3 of 15, U.S. Consultants: 24% women – 75 of 311
  • Heidrick: Senior Leadership: 16% women – 1 of 6, U.S. Consultants: 25% women – 46 of 184
  • SpencerStuart: Senior Leadership: 0% women – 0 in 7, U.S. Consultants: 38% women – 54 of 141
  • Russell Reynolds Senior Leadership: 0% women – 0 of 1*, U.S. Consultants: 39% women – 41 of 108

Despite the paucity of women in top leadership roles, the retained search industry hates, hates, hates to discuss sexism as if closing its eyes to gender bias will make it all go away. It is the same kind of wishful thinking practiced by a toddler who thinks covering his eyes with his hands makes him invisible. The old boys that remain of the Old Boys’ Network are Masters of Denial, an impulse rooted their privileged white male DNA.

The retained search industry emerged in the 1950s as firms spun off from professional services companies. Gardner Heidrick and John Struggles were both veterans of the management consulting firm Booz Allen Hamilton. Spencer Stuart worked for them for a year before leaving to found his own search firm. Lester Korn and Richard Ferry met at accounting company Peat, Marwick, Mitchell. Russell Reynolds worked for a time for William Clark, a firm that had been spun off from another accounting firm Price Waterhouse. Sid Boyden was ahead of all of them, founding his firm in 1946. However, in the decades since their founding, not a single firm has chosen to name a woman as their CEO. That paticular glass ceiling has yet to shatter, mirroring the vast majority of the Fortune 500 firms that they serve.

Understandably, gender bias has long been topic that most people would rather not discuss. Most of us prefer to focus on the positive, because sexism, like any other kind of ism, is such a bummer. Besides, people get all squirmy and uncomfortable in much the same way people don’t like to talk about race, which is why President Obama rarely goes there. However, the bias now appears to be getting turned on its head. Whatever was working against women now appears to be working for us as a gender. More important, it appears to be working for our society as a whole. It isn’t that women benefit: we all benefit. The End of Men article by Hanna Rosin goes on to point out:

Up to a point, the reasons behind this shift are obvious. As thinking and communicating have come to eclipse physical strength and stamina as the keys to economic success, those societies that take advantage of the talents of all their adults, not just half of them, have pulled away from the rest. . With few exceptions, the greater the power of women, the greater the country’s economic success.

In other words, countries where women are on the rise simply make more money. (Do I have your attention yet??) That capitalistic truth should be reason enough to pursue gender neutrality within our own ranks, and to inspire us to help our clients usher deserving, hardworking women up into middle and upper management where they have yet to enjoy their fair share. The reason is as simple. To quote a campaign slogan of former Bill Clinton, “It’s the economy, stupid.” The End of Men, as a thesis, simply means that whenever a woman advances and gets more, it’s not that she get a male colleague’s slice of pie — the pie actually grows. That fact alone ought to be enough to inspire even the most serious among us to break out in dance. Of course, Ms. B is going to help us do it in style. To learn the Single Ladies dance, simply study her dance routine below, slowed to half time.