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Below are some interesting 2007 market trends and predictions in senior executive and board-level talent acquisition and retention from Joel Koblentz at Morgan Howard.  Thought it may be of interest to a broader audience.
Thanks,
David
From: Joel Koblentz [mailto:joel.koblentz@morganhoward.com]
Sent: Friday, January 12, 2007 3:48 PM
Subject: Executive Trends from Joel Koblentz

As is our tradition, below are a few trends, predictions and thoughts for 2007:

• The accelerated velocity of executive “musical chairs” in 2007 and beyond will continue unabated and will be driven by investor expectations of improved performance, placing heightened pressure on boards and their management, i.e., urgency and results. In the past two years, it is noteworthy that 25% of U.S. based public company CEOs have changed principally due to performance shortfalls, the options situation, and the attraction of opportunities for wealth in private equity situations without the spotlight of leading a public entity. Along these lines, our clients are seeking leadership that delivers quality results quickly while positioning their companies for enhanced future valuation. We have advised our clients’ boards to expect that turnover of their most talented executives will accelerate and that attracting the appropriate leadership at the “C” level will require extraordinary diligence. In fact, the latest information suggests that “C” level turnover hit record levels in 2006 – 110% over 2005.
• As a result of these conditions, we continue to conduct numerous searches for Operating, Financial, and Sales and Marketing executives. Demand remains strong. This trend is consistent with the push for performance. The “cost” of attracting and retaining a highly qualified talent base continues to “move north” as executives with substantive track records enjoy numerous career options. For the first time, we can say that many companies, given this revitalized war for talent, are becoming serious about succession planning at all senior levels and are seeking a “true” return on their investment in talent.  Interestingly, executive demand by our clients for leadership in their human resources, information technology and technology related functions has, at the moment, somewhat cooled. We are advising our clients that if they have a requirement in these functional areas, given market conditions, it may be advantageous to move forward to recruit highly qualified professionals under the current “reasonable conditions,” which, based on our discussions with numerous companies, are likely to change by the end of the first quarter.
• The demand for “C” level leadership in Asia for American and European companies will continue to spiral upward. Our offices in Singapore and China report that the demand for culturally sensitive, savvy executives with track records exceeds the quality of the talent pool.  We recommend to our clients to think carefully about the qualities needed in advance of recruiting in Asia, albeit with an appreciation of culture which varies from market to market. Plan ahead for such a search, involve the company’s senior team, and be diligent to assure success in the recruitment of senior executives in India, China, Singapore and Malaysia.
• We predict, based on our discussions with Chairpersons and Lead Directors, that corporate boards will experience in 2007 the biggest turnover of members since the onset of Sarbanes-Oxley. This is driven by term expirations where board members have selected not to stand for re-election (time requirements and liability matters are the two causes most mentioned); where ineffective board members are not being re-nominated, and where the needs for specific expertise and diversity must be met at the cost of less effective members, the latter two points reflecting the shrinking size of corporate boards. Boards continue to face complicated matters where diligence and due care requires extraordinary commitment. Many who are qualified to serve as independent board members tell us that they cannot justify the time commitment, even with increased board compensation. Fear of the “unknown” continues to dominate board member concerns.  Our advice to clients is to consider the merits, experience and competencies of a broad base of independent board candidates. Consider only those candidates who sit on no more than two boards, thus minimizing conflicts of interest and time. To the extent possible, plan ahead, as attracting qualified board members in today’s environment requires a significant board member commitment. Morgan Howard’s approach to successfully attract qualified board candidates is to “partner” with each board’s nominating committee, and involves mapping governance competencies, which oftentimes reduces the inevitable “wrinkles” of such recruitments.