The New Playbook for HR Leadership

September 21, 2026 – Chloe Watts co-leads Wilton & Bain’s people & culture practice focusing on supporting clients with HR interim appointments. She joined Interim Management as a partner in September 2015, bringing multi-sectoral experience with a real depth of expertise in resourcing specialists in people strategy, HR, OD, change, reward, talent, learning & talent acquisition.

Ms. Watts recently sat down with Hunt Scanlon Media to discuss the evolving role of today’s HR leaders, the growing influence of AI on the profession, the future of diversity in executive leadership, and the qualities organizations are seeking as they recruit the next generation of CHROs.

Chloe, what are some current issues facing HR executives today?

All executives in both the U.S. and U.K. continue to navigate a complex landscape shaped by accelerated technological change, shifting workforce expectations, and macro political and economic uncertainty. The biggest topic, AI adoption, is both an opportunity and a concern, requiring leaders to balance more automation with ethical working practices, to say nothing of how to value the human elements of work. Attracting and retaining talent remains critical, especially as younger generations entering the workplace prioritize purpose, flexibility, and development over traditional, linear career models. In this environment, developing career paths premised on skills development and broadening is still new ground. Across all levels, skills frameworks involving teaching, upskilling and reskilling are urgent priorities, with many organizations struggling to close capability gaps quickly enough for rapidly evolving job requirements. In addition, there is a big focus on performance management. During and immediately post-lockdown, organizations focused heavily on employee experience and wellbeing. Now employers are asking for something in return, namely performance. This shift in culture and expectations is creating tension.

What are some things expected from HR leaders today?

HR leaders today are expected to demonstrate strategic value, moving beyond compliance and people services administration (which is not to underestimate these core foundations) to drive culture, innovation, and business outcomes which create enterprise value. The role is increasingly cross-functional, requiring fluency in data analytics, change management, and apolitical stakeholder engagement. Meanwhile, DEI efforts, once central, are facing scrutiny and budget cuts, challenging HR functions to maintain momentum without executive-level sponsorship and/or investment. Mental health and well-being support are critical to combat the ever-increasing rise in burnout and disengagement. Left unchecked the cost of unproductivity becomes punitive.

What makes the best HR leaders?

Exceptional HR leaders must first and foremost be business leaders. They must read a P&L as readily as an engagement survey. They represent their core discipline at the top table and bring this perspective to commercial and strategic decisions but they cannot only be HR specialists. Indeed, there is an emerging trend to appoint other business leaders into the HR seat who shore up a lack of specialist expertise with strong practitioners at C-1 level. Bringing a blend of strategic foresight, emotional intelligence, and operational agility, the best HR leaders are business partners aligning people initiatives with organizational goals while championing values and culture. The CHRO shouldn’t be any different to any other member of the C-suite in being data-driven. They must lead functions who collate and deploy people analytics to inform decisions on talent, performance, engagement and reward. We are in the midst of digital evolution and there is no excuse for manual processes run off a spreadsheet. Proving the commercial value of strong people data is entry level stakes for the best HR leaders.

Anything else?

They are also change agents, adept at navigating and directing organization transformation -whether through digital disruption, cultural shifts, growth or restructuring. They add value in understanding how to manage both the process and communication through these disorienting periods. Crucially, top HR leaders are inclusive and empathetic, fostering environments where commercial rationale and positive culture co-exist. This is most tested during periods of change so they must use strong communication skills, enabling them to influence across the C-suite and build trust throughout the organization. Ultimately, the best HR leaders are those who can balance people and performance, creating cultures that are both compassionate and competitive.

Recently we have heard people say that diversity efforts at companies have not been in the forefront recently. Have you seen this or has this reverted in recent months?

There has been a noticeable recalibration of corporate diversity efforts in recent months. While some organizations have deprioritized DEI amid economic pressures and political scrutiny, others are doubling down with more strategic and integrated approaches. In both the U.S. and U.K., companies are shifting from statements of intent to measurable outcomes, embedding inclusion principles into core people functions such as talent management, leadership development, and commercial programs such as supplier diversity and ESG credentials. Disclosure practices are evolving, with more firms electing to report workforce demographics and board diversity metrics even where it is not mandated. Importantly, intersectionality and belonging are gaining traction, moving beyond specific characteristics such as race and gender to encompass neurodiversity, socio-economic background, and multiple generations. AI is being leveraged to reduce bias in recruitment and performance reviews, though it introduces new ethical considerations around the inclusive nature of the baseline algorithms. While the pace of progress varies, the overall trend suggests there isn’t a full-scale roll-back on sustainable DEI practices. Instead, there is still a desire and belief in the benefits of embracing breadth of perspective, driven by stakeholder expectations, ESG frameworks, and the clear link between diversity and innovation. Executive Search professionals can play a pivotal role by advocating for diverse shortlists and inclusive hiring practices.

Discuss the lack of diversity at the C-suite level.

The lack of diversity at the C-suite level remains a persistent challenge due to structural barriers, historically narrow succession pipelines, and bias in leadership selection. Many organizations have relied on traditional networks and criteria that favor homogeneity, limiting access for underrepresented talent. Moreover, board-level inertia and risk aversion often slow progress, especially when diversity is viewed as a compliance issue rather than a strategic imperative. The result is a leadership landscape that fails to reflect the diversity of the broader workforce and customer base. It is taking time to dismantle these frameworks in favor of identifying potential over tenure and providing opportunity for greater visibility and exposure.

Why is it persistent and what is being done to add more balance?

However, change is underway. Companies are increasingly tying executive compensation to DEI metrics, expanding leadership development programs for diverse talent (including replacing exclusive programs for specific pools of employees which unintentionally shine a light on ‘difference’ rather than promoting ‘equity’), and partnering with executive search firms to broaden candidate pools. Formal and informal mentorship and sponsorship initiatives are also highly effective and personalized experiences to help high-potential individuals navigate the path to senior roles. In the U.K., regulatory frameworks like the Parker Review are pushing for ethnic diversity on boards, while in the U.S., shareholder activism and Nasdaq’s listing rules are driving transparency. The shift from tokenism to inclusive leadership models is gaining momentum.

What are the biggest advantages of hiring diverse talent?

Hiring diverse talent delivers measurable business benefits that go far beyond compliance. Diverse teams bring broader perspectives, leading to more creative problem-solving and innovation. Studies from the MBB and World Economic Forum consistently show that companies with above-average diversity generate significantly more revenue from new products and services. Diversity also enhances decision-making, as varied viewpoints challenge groupthink and foster more robust debate. The critical factor here is to create a psychologically safe environment where challenge is encouraged rather than vilified. From a talent perspective, inclusive organizations are better positioned to attract and retain top candidates, especially among younger generations who prioritize values alignment. Moreover, diverse teams improve customer insight and market reach, particularly in global or multicultural markets. They also contribute to stronger employer branding, signaling a commitment to equity and belonging. Financially, inclusive companies outperform peers in profitability and resilience. For Executive Search professionals, promoting diversity is not just ethical—it’s promoting competitive advantage that aligns with enterprise success.

“Companies are increasingly tying executive compensation to DEI metrics, expanding leadership development programs for diverse talent (including replacing exclusive programs for specific pools of employees which unintentionally shine a light on ‘difference’ rather than promoting ‘equity’), and partnering with executive search firms to broaden candidate pools.”

How are HR executives adapting their strategies to address challenges with hybrid work, employee well-being, and evolving workplace expectations?

Top teams have reimagined their workforce strategies to meet the demands of a transformed workplace. Hybrid work shifted the focus from presenteeism to performance and outcomes, prompting investment in digital collaboration tools, flexible policies, and inclusive remote onboarding. The rollback on hybrid policies particularly prevalent in the U.S. is creating some tension and potential competitive advantage for firms with more flexibility. While these global institutions typically cite productivity, collaboration and culture as key drivers for this decision, employees may disagree. HR leaders who direct more nuanced approaches by maintaining flexible hybrid models, especially among SMEs and knowledge-based sectors, could become more appealing as employers of choice.

Anything else a core expectation for HR leaders?

Employee well-being is now a core expectation from any people strategy. It is usual for companies to have mental health support, physical, emotional and financial wellness programs, and holistic benefits. The extent to which employees feel safe to take up these options is down to the lived experience of the culture. HR leaders would be wise to ensure well-intentioned policies and programs go beyond tokenism to build engagement, trust and, ultimately, productivity. Regulatory changes and social expectations are driving more transparent and equitable practices. Digital tools enable continuous listening—via pulse surveys and engagement platforms so there is no excuse for leadership to be detached from the culture. Acting early and proactively on feedback, goes a long way to increase the bond between employer and employee. HR leaders have a significant role to play on the executive team to curate an empathetic culture focused on enterprise outcomes, optimizing productivity in a cost-effective yet psychologically engaging way. It is no small ask but intellectual dexterity, emotional intelligence and pragmatism separate the best from the good. Executive search professionals can support this evolution by identifying people leaders who thrive in ambiguity, champion inclusive cultures, and deliver tangible outcomes.