A little younger. A little more likely to be a woman. Very likely to have been promoted internally, and to have been a head of division. Quite likely to be from a different country than where the company's headquarters is located. Also quite likely to have experience outside the company's sector.
That's what new statistics from Heidrick & Struggles indicate: that after last year's halt on succession planning, companies are coming back with a desire for more diversity among their CEOs. The H&S Route to the Top 2021 report, released earlier this week, puts it this way: "The CEO role itself is expanding far beyond its historical day-to-day running of the business. CEOs today need to champion (both internally and externally) issues such as sustainability, social justice, DE&I, and cybersecurity, along with other issues specific to their business or geography."
And so companies have been seeking out fresh perspectives, while developing internal succession pipelines. That manifested in a rebound, according to the H&S report. Across 14 countries that the report has tracked since 2018, the number of CEOs appointed at the top publicly-listed companies more than doubled in the first half of 2021, compared to the second half of 2020. Most of the growth came from Australia, the US, Germany, and France.
What's more, there was a small but distinct increase in diversity among these appointments. More women were appointed; more people with cross-border experience were appointed; and more people with cross-sector experience were appointed. And more of these new CEOs had experience in other C-suite roles. While CFO and COO experience have always been popular, the number of appointments with C-level experience outside this favoured trinity - CEO. CFO, and COO - has almost tripled.
Jeff Sanders, vice chairman and co-managing Partner of Heidrick & Struggles global CEO & Board of Directors practice, said these changes to the CEO roles arise from the multiple other changes in company, industry, and environment. “The top job, like so many others, has been altered by the rapid changes that have taken place over the last 18 months," he observed."Boards and organisations are taking a more expansive view in their CEO succession planning."
This broader approach is not going to be a one-off thing, H&S analysts believe. The report projects not just increased investment in developing internal candidates, but also a greater focus on leadership qualities rather than specific skill sets - which will in turn drive a wider search and greater diversity in both the succession pipeline and the top seat.