Egon Zehnder Assists CalSTRS in CEO Search

June 23, 2021 – Egon Zehnder has assisted the California State Teachers’ Retirement System (CalSTRS) in the naming of chief operating officer Cassandra Lichnock as its new chief executive officer. She is the first woman to serve as the pension fund’s chief executive in its 108-year history and will replace current CEO Jack Ehnes. Ms. Lichnock assumes the CEO role on July 1. During a thorough and rigorous process, Lichnock emerged as the selected candidate in a highly qualified pool, the agency said. “Cassandra’s experience and knowledge of CalSTRS operations and culture will ensure a smooth transition and continuity for our members, employees and stakeholders,” said Teachers’ Retirement board chair Harry Keiley. “She is the right choice to continue partnering with the board, staff and executives to deliver on our mission to provide a secure retirement to California’s educators.”

Ms. Lichnock joined CalSTRS in 2008 as the human resources executive officer and has served as COO since 2013. In this role, she oversees the audit services, enterprise strategy management, administrative services, benefits and services, public affairs, and technology services divisions as well as the ombuds office. Ms. Lichnock advises the Teachers’ Retirement board and the CEO, ensuring that the most complex and critical operational issues and policy matters impacting the system are developed and implemented consistent with CalSTRS mission, vision and values.

“I am honored to have been chosen to take over the reins at CalSTRS from Jack Ehnes, a highly regarded CEO. Jack has been an extraordinary mentor and business partner,” said Ms. Lichnock. I plan to carry forward our work on improving service delivery to our members and ensuring their financial security in retirement.”

As CEO, Ms. Lichnock will be expected to build and execute strategy, deliver on operational excellence and forge a strong relationship with the board. She will continue her leadership in modernizing CalSTRS systems and processes, build on the fund’s commitments to sustainability and diversity, and focus on evolving CalSTRS culture as the organization plans for a post-pandemic future.

“I am already working with the board and executives to build on the progress we’ve made on sustainability, social responsibility, diversity, equity and inclusion,” Ms. Lichnock said. “It’s not lost on me that I am the first woman to lead CalSTRS. I am so proud of our culture. Our staff’s dedication to our mission and their work is what makes CalSTRS an outstanding organization and destination employer. I am excited to lead this organization as we take on the challenges and opportunities the future will present.”

Largest Educator-Only Pension Fund

The California State Teachers’ Retirement System was established by law in 1913 to provide retirement benefits to California’s public school educators from pre-kindergarten through community college. Today, CalSTRS is the largest educator-only pension fund in the world and the second largest pension fund in the U.S. The organization is located in West Sacramento, CA.

Related: Egon Zehnder Retained by American Equity Investment Life Holding Co. to Lead CFO Search

Egon Zehnder’s public and social sector practice works in partnership with its clients to advise governmental, NGO, non-profit, civic and academic institutions on finding top leadership. Each client and mandate is bespoke, with its engagements covering executive search, leadership assessment and development, team effectiveness, succession planning as well as organizational change management consulting.

Why Recruit from Within?

Recruiters focused on finding talent for the C-suite say that at least half of all job openings are filled by internal candidates before the positions are introduced to the public job market. This may suggest that companies have relatively reliable bench strength even though leadership development is seen as stagnating at many companies. The main reason given: Companies prefer to promote from within.

Bridging the Skills Gap With Insiders
There has been an emergent skills gap that has plagued almost every industry. While organizations have implemented a series of measures to improve oversight of labor costs and value returns, they have focused more on improving the quality of talent acquisition than they have on sustaining employee performance. 

For those searches that go to recruiters, with a clear mandate to look wide and deep both inside and outside a client organization, internal candidates still surface more often and get the job about 80 percent of the time.

Recruiters say clients generally like to be seen as making bold moves but in the end many remain risk averse when it comes to hiring elite executives, especially into their highly protected upper leadership ranks. They look at insiders as safer bets. Knowing this mindset going in, recruiters say they advise their clients that when they have an inside candidate who is 70 percent as strong as an outside choice to hire the insider. Fit and culture seem to be the deciding factor.

“There is a greater risk when you bring somebody in from the outside that it won’t work out,” said Kathleen Yazbak, founder of Boston-based Viewcrest Advisors, a boutique search firm focused on finding leadership talent for mission-driven and high-performing companies, social enterprises and philanthropies.

Internal candidates know the business model, organization goals and inside cultures, say recruiters, and oftentimes they have the requisite skills. They know the customers, clients and co-workers. They have also established relationships with colleagues and their organization’s leaders. But, more importantly, they have already shown their potential. They can, therefore, assimilate faster and will likely be more satisfied in their new roles than outside hires.

Related: Societe Generale Turns to Egon Zehnder to Find Next CEO

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media

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