“Tough at the top for high-flyers”

More and more public companies seek leaders and it is becoming increasingly difficult to find suitable candidates either for executive or non-executive director appointments, especially as the private sector is seemingly so attractive.

Alan Priest, Senior Consultant at Jackson Taylor Executive Search, said:

“Our company has for 35 years been identifying and helping to select future leaders for commerce, industry and the professions embracing CEO’s, COO’s, executive and non-executive directors as well as partners for the legal and accountancy professions.

We are now detecting a strong feeling of unease and concern amongst young and talented ‘high flying’ executive managers endeavouring to enhance their careers. There are signs that the potential senior managers of the future are reluctant to accept executive positions especially within the Plc market. These candidates consider that the personal risk of contentious litigation through unwittingly making a professional mistake, despite being honourable and hard working executives,` is not worth bearing.

A raft of new regulations and discussion documents are being continuously introduced by the DTI concerning the future of corporate governance. Some of these are beneficial to the business world and its shareholders, but others are not and are having a detrimental effect on the hard pressed performance of executives.

In our view, this extra bureaucratic burden is deterring the development of future leaders in Plc’s to the country’s detriment. Talented young people are starting to look elsewhere for less risk related remuneration either within privately owned or overseas based companies where employment terms negotiated for high office duties are considerably less onerous than in the UK.

Government must use its good offices to hold on to what is left of British owned industry and commerce by encouraging and creating a stable and harmonious working platform for its future senior management. With the imposition of unnecessary regulations there is no small wonder why companies are increasingly opting out of Stock Exchange listings.”

Interviewed by Jonathan Moules of the Financial Times, Alan Priest said: “We are talking about professional people, probably in their mid-40s, who are determined to do well. They are wondering whether they would prefer to work in a different business environment or maybe in the US where risk isn’t frowned upon.”

Mr Priest believes companies are going to find it harder to recruit the right people because the risks of failure now outweigh the rewards of a senior post. “There is a danger that we are going to be choosing second-class candidates because the first-class people are really thinking it through and wondering whether they want to be involved.”

Rushing into an appointment is also a risk, he notes. He points to the recent debacle at Sainsbury, when the board was forced to cancel its appointment of Sir Ian Prosser as deputy chairman after investors objected.