January 28, 2021 – Pascal Bécotte leads the Canadian operations for Russell Reynolds Associates and co-leads the firm’s global corporate officers’ group, which includes practices covering finance, human resources, operations, and supply chain, legal, regulatory, and compliance and corporate affairs. He is also a member of the firm’s global executive committee, as well as a member of its healthcare and industrial teams, where he advises clients across the globe on their overall talent strategy, particularly with respect to leadership assessment, succession planning and the recruitment of directors, CEOs, and other senior executives.
Dr. Bécotte recently sat down with Hunt Scanlon Media to discuss the Canadian search market and the opportunities that lie ahead. Following are excerpts from that discussion.
Pascal, what is the current climate for executive search in Canada?
The Canadian executive search market is as sophisticated, and in some sectors, perhaps even more complex than the U.S., despite being significantly smaller. All five major global executive search firms have a Canadian presence, and several mid-tier firms also have offices in major cities. The client base is not homogeneous across provinces, which has created a sector and region-specific network of specialized boutiques as well (e.g., specialized financial services sector boutiques in Toronto, specialized energy sector boutiques in Calgary). Notably, these sectorial and regional differences also create the need for executive search firms to be able to access candidate pools that reflect the integrated supply chains specific to each industry. For example, when executing a search in oil and gas we consider candidates based in Alberta, and also in Texas and the Middle East. The manufacturing base in Ontario requires us to be acutely knowledgeable of the candidate pools in the U.S. Midwest and abroad. If doing a board search for one of the Canadian chartered banks, we leverage our knowledge in similar governance regulatory environments and regions such as Australia or New Zealand, particularly their banks and pension funds.
Describe the impact of COVID-19 on your business.
Despite Canadian authorities having taken the COVID-19 crisis seriously right from the beginning, the business climate has been negatively impacted for obvious reasons. At Russell Reynolds, we have prioritized being able to work flexibly and nimbly, acting as one team to help our clients navigate these complex times and proactively address what is to come. Like other industries and organizations, our business instantly adapted to working from home, leveraging our online meeting/interviewing/interfacing tools at top speed. We believe this technological adaptation will have a more lasting impact on the search business. As the last year has shown, several business models that were taken for granted for decades are now struggling to survive. On the other hand, businesses that quickly embraced the new reality, reinvented themselves and pivoted their strategy, are reaping the benefits of harnessing the crisis for their own evolution compared to others who were initially betting on a quick return to “the old normal.”
We have adopted AI tools and machine learning into our operations to ensure we deliver the best possible experience for our clients. With that said, it has been our observation for several years now that clients are seeking advisory services in addition to executive search consultancy including executive assessment and development as well as CEO succession advisory services. Executives face greater challenges in managing culture, developing top teams, and ensuring succession preparedness. COVID-19 created a sudden and profound introspection at the board and CEO level as the speed of change became difficult to stomach for many leaders. Ultimately, it prompted an incredible acceleration in all forms of advisory, assessment and effectiveness services across teams, culture, diversity, equity and inclusion, and boards.
What is your 2021 forecast?
We obviously have more questions than answers about the near future at this stage. When will most Canadians get vaccinated, and consequently, resume regular social and business activities? Will there be a new strain that current vaccines cannot tackle? Will social and political unrest in the U.S. have an impact and spread to Canada at any level? With these significant unknowns squarely acknowledged, we feel cautiously optimistic about 2021 for our Canadian business. Russell Reynolds Associates has dedicated local and regional capabilities in Canada. Additionally, our Canadian offices have several North American and global experts in fields such as: infrastructure, vaccines, cell and gene, biologics manufacturing and R&D, artificial intelligence, and governance. This strong mix of expertise led to revenue growth in Canada during 2020, and we expect it to continue in 2021 and beyond.
What positions are you seeing most in demand? Which sectors are hiring the most?
As indicated above, the demand is created by changing sector dynamics (e.g., an increase in vaccines manufacturing leadership demand), but more importantly by macro-economic forces caused by the impact of COVID-19. Following a 10-plus year growth market it is only normal that many executives in the C-suite, or in CEO and board roles, have not experienced a crisis as senior executives. As a result, many were either not prepared or not capable of adjusting their leadership from “growth” to “crisis” requirements. Specifically, leaders today must make decisions faster and with less data/ certainty than they would have had to 12 months ago, and not all are equipped to adjust to this new reality. The key is to rapidly assess who can and who cannot make this shift, give more room and responsibility to emerging leaders who are positively surprising the organization and limit the negative impact of those who cannot. Demand remains high for board directors bringing specific expertise/experience, for instance, CFOs that have downturn experience, operations and supply chain leaders with strong track records doing more with less, and obviously the broader healthcare sector. We also see demand for a new type of leader emerging, a sustainable leader, that is well positioned to support firm growth and balance the importance of people, planet, and profit.
Canadian search firms have been partnering and merging with U.S. based talent agencies. What benefits does this bring?
Search firms that lack cross-border offices and consultants often seek partners to serve their clients. As a global, integrated firm, we customize our teams to meet our clients’ needs by bringing in experts across countries, industries, functions, and advisory expertise. Given that M&A activity has increased across all industries due to COVID-19, we imagine that our industry will also see changes in our competitive landscape over time. For instance, we recently acquired the cultural analytics business of Workplace Analytics, the academic-led provider of data-driven insights and analysis about corporate culture. By acquiring this capability, we expanded its culture assessment portfolio to assist CEOs, boards and CHROs in more accurately identifying deep-rooted issues within a company’s culture and creating cultures that drive performance, spur innovation and foster collaboration – on a global scale.