Share the Report. The BlueSteps. Global Executive Outlook

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1 Share the Report The 2014 BlueSteps Global Executive Outlook

2 About BlueSteps.com BlueSteps.com is an online career management service for global senior executives. As an exclusive service of the Association of Executive Search Consultants (AESC), BlueSteps enables senior executives to make their career profile accessible to over 8,000 retained executive search professionals in more than 75 countries who are members of the AESC, and use the database as an additional resource in their candidate and source identification process. BlueSteps members can stay informed of executive job market trends and news via the BlueSteps Career Library and Blog, and use a variety of tools and resources to facilitate the successful management of their executive career path. Click here for more information or visit: BlueSteps.com. About The Association of Executive Search Consultants The Association of Executive Search Consultants (AESC) is the worldwide professional association for the retained executive search sector. The AESC promotes the highest professional standards in retained executive search consulting, broadens public understanding of the executive search process, and serves as an advocate for the interests of its member firms. For more information, or to download the AESC Code of Ethics and Professional Practice Guidelines, please visit About Executive Search Connect The AESC also offers a service for the HR community offering sector information and tools to assist with senior executive recruiting, including access to the AESC membership directory. 425 Fifth Avenue, 4th Floor New York, NY Phone: 1 (800) info@bluesteps.com Web: Share the Report

3 The 2014 BlueSteps Global Executive Outlook Report Contents: Page 4-5: Executive Summary Page 6: About Our Study Page 7-9: Survey Demographics Page 10-11: 2014 Global Executive Outlook Page 12: Executive Concerns Page 13-15: 2014 Executive Mobility Page 16-18: 2014 Executive Compensation Page 19-20: 2014 Executive Opportunities Page 21-22: The Global War for Talent Page 23: Executive Search Industry vs. Executive Job Market

4 4 Executive Summary The BlueSteps Global Executive Outlook Survey was conducted in December 2013 and received 508 responses from BlueSteps member executives worldwide, including 50% from the Americas, 37% from EMEA and 13% from Asia Pacific Executive Job Market Outlook The 2014 BlueSteps Executive Outlook shows that the majority (51%) of global senior executives share a positive outlook regarding the global executive job market in 2014 up 15% compared to the 2013 outlook. Only 13% of executives surveyed harbor a negative view of the executive job market for Peter Felix, AESC President commented: The results of our Outlook survey suggest that many executives are of a mindset to consider a career change and are increasingly optimistic that the environment will be conducive for this to happen. A number of forces are at work to stimulate this not least being the strategic forces such as globalization, digital transformation and industry restructuring that are changing the corporate landscape and are presenting new challenges on a continuing basis. In spite of continuing volatility in some regions and sectors, there is real evidence of organizations thinking more strategically and looking ahead with a positive mindset. Senior management appointments are one of the key focal points as Boards and top management evaluate the future and consider whether they have the right people in the right jobs. After 5 years of moribund compensation growth and cost cutting pressures, many executives will consider themselves to be mobile once again and interested in a change of environment and opportunity. Greater economic certainty will encourage them to take career risk and this mobility factor may well usher in a new phase in a War for Talent which has been less visible during the financial crisis. Added factors will be the megatrends of the demand from new markets around the world, the major demographic shifts now biting to an unprecedented extent as the baby boomers finally want, and can afford, to retire and the desire by many corporations to feed their succession pipelines. For talented executives this new and more positive environment may well offer unprecedented opportunity Business Outlook Sixty percent of global executives share a positive impression of the general business climate for 2014 up 18% over Only 9% of executives surveyed harbor a negative view of the general business climate for Outlook by Region In numerous markets, including Canada (92%), China (78%) and Germany (70%), executives are reporting an extremely positive outlook on the executive job market for These results show a dramatic regional shift in many executives attitudes about the executive job market from 2013 to In 2013, executives in India had the most positive regional outlook (73%). Though executives in India still have a very positive outlook for 2014 (63%), it does not rank in the top three markets. Executives in some markets harbored a more negative outlook than most. In Australia/New Zealand, 50% of senior-level executives stated that they have a negative outlook on the executive job market. Executives in

5 5 Africa (33%) and ASEAN (31%) also have a less positive outlook than the majority of respondents. Executive Mobility - Making a Career Move in 2014 With such a big change in the global senior executive outlook, it s not surprising that 74% of executives report being more willing to make a career move in 2014 than in 2013, while 87% plan to at least look for a new executive opportunity this year. When asked to choose the top two elements that might hinder them from making a career move in 2014, the majority (86%) cited the inability to find opportunities that match their career goals, followed by declines in compensation (43%). When asked to report the top two benefits that would most entice them to consider a career move in 2014, 64% of executives reported a move to a better role with increased responsibility, followed by 60% who reported an increase in total compensation as a primary motive for making a career move. Consistent with data from the last two years, 45% of executives expect it to take them on average 6-12 months to secure their next executive opportunity. Executive Compensation in 2014 Regarding executive pay, 53% of executives expected their compensation to increase in 2014, while 39% expected their compensation to stay the same in 2014 as in Only 8% of global executives expected their total compensation to decrease in The Global War for Talent Global executives predict the greatest executive talent shortages to occur in the United States, China and the Middle East during Executives also predict the greatest talent shortage to occur in the technology/ telecoms sector, followed by healthcare/life sciences and energy/natural resources.

6 6 About Our Study Participants executives from around the world participated in the study. Gender 355 men 65 women 88 did not identify gender Career Level

7 7 Survey Demographics Regions of the World Represented by Survey Participants US 40% Continental Europe 18% UK Middle East ASEAN India CEEC Brazil Central/South America Canada Other Australia/New Zealand China Germany Africa 6% 5% 4% 4% 4% 4% 3% 3% 2% 2% 2% 2% 1%

8 8 Survey Demographics Sectors Represented by Survey Participants Manufacturing/Industrial 27% Technology/Telecoms 20% Professional Services 11% Financial Services 10% Healthcare/Life Sciences 9% Other 7% Energy/Natural Resources 7% Not for Profit/Public Sector/Education 4% Media/Entertainment/Advertising/PR 2% Hospitality/Tourism 2%

9 9 Survey Demographics Functions Represented by Survey Participants CEO/President/GM 26% COO/Operations/Production 15% Business Development & Sales 12% CFO/Finance & Accounting 11% Consulting 8% Other 7% CMO/Marketing/PR 7% CTO/CIO/Technology 6% Board Director 4% R&D/Product Development 3% HR & Training 2%

10 10 Executive Outlook 2014 Outlook - Executive Job Market 36% Positive Negative 51% Neutral 13% The majority of global senior executives share a neutral to positive outlook regarding the global executive job market in 2014, with 51% of executives feeling positive and 36% feeling neutral. Thirteen percent of global executives share a negative attitude about the global executive job market in This represents a significant change (+15%) compared to this time last year when only 36% of executives felt positive about the executive job market for Outlook - General Business Climate 31% Positive Negative 60% Neutral 9% The majority of global senior executives share a positive outlook regarding the global business climate in 2014, with 60% of executives feeling positive and 31% feeling neutral. Only 9% of global executives share a negative attitude about the global business climate in Executives with a positive business climate outlook has also increased significantly (+18%) since this time last year when 42% of executives felt positive about the business outlook for 2013.

11 11 Executive Outlook - Comparisons Regional Attitudes About the Executive Job Market in 2014 Based on the percentage of executives reporting that specific outlook Region Positive Negative Neutral Africa 33% 33% 33% ASEAN 50% 31% 19% Australia/New Zealand 20% 50% 30% Brazil 61% 6% 33% Canada 92% 0% 8% CEEC 31% 19% 50% Central/South America 38% 15% 46% China 78% 0% 22% Continental Europe 41% 11% 48% Germany 70% 10% 20% India 63% 6% 31% Middle East 41% 18% 41% Russia 50% 0% 50% UK 63% 8% 29% US 52% 14% 34% Sector Attitudes About the Executive Job Market in 2014 Based on the percentage of executives reporting that specific outlook Sector Positive Negative Neutral Energy/Natural Resources 66% 3% 31% Financial Services 60% 20% 20% Healthcare/Life Sciences 54% 13% 33% Hospitality/Tourism 38% 13% 50% Insurance 75% 0% 25% Manufacturing/Industrial 50% 9% 41% Media/Entertainment/Advertising/PR 60% 20% 20% Not-for-Profit/ 53% 6% 41% Public Sector/Education Professional Services 57% 13% 30% Technology/Telecoms 40% 21% 39%

12 BlueSteps Executive Compensation Report Executive Concerns Career-Related Concerns Amongst the 13% of executives who viewed the executive job outlook as negative for 2014, finding a new executive opportunity was the primary concern of most executives, followed by ongoing concerns regarding increased competition for executive jobs, ageism s impact on the ability to obtain a new job, and the volatile economic and political conditions. Specific comments included: Business is down and many of the larger companies are downsizing, I expect it to be difficult to find a position at the right level in Executive candidates are widely available and seeking jobs. For example, a senior general counsel position received over 700 applicants through a direct solicitation by the employer. The finance industry is shrinking, with more regulation and risk-aversion, while the pool of highly qualified executive job seekers is expanding rapidly. Business-Related Concerns Amongst the 9% of executives who viewed the business outlook as negative for 2014, the main concerns continue to be related to global economic volatility, with many pointing to the ongoing financial crisis in Europe, political gridlock and a perceived lack of fiscal responsibility by the US government and a slowdown in Asia Pacific. India is going through political instability and therefore economic turmoil. Investor sentiment is poor due to poor policies and the weak rupee. This is has a multi-level impact on the ability for industries and businesses to grow. Slowdown in global growth, flat growth of Western economies and the slow down of the BRIC economies could portend slower global economic growth. I am concerned about the continued gridlock in Washington, which I believe will continue well into As the economy continues to recover, I expect the manufacturing sector to remain strong as companies invest in new products and repatriate products from offshore facilities.

13 13 Executive Mobility 2014 Global Executive Mobility The greatest percentage (74%) of global executives are more willing to make a career move in 2014 than they were in Only 7% of executives feel less willing to make a career move in 2014, while 19% of executives report they are as willing to make a career move in 2014 as they were last year. 7% 19% 74% I am more willing to make a career move in 2014 than I was in 2013 I am less willing to make a career move in 2014 than I was in 2013 I am as willing to make a career move in 2014 as I was in 2013 The Search for New Opportunities Despite a challenging global economy, 87% of global executives plan to look for new opportunities in 2014 compared to the only 13% of executives who do not plan to look for a new executive opportunity in % Yes No 87%

14 14 Executive Mobility Making a Career Move in The Negatives Inability to find an opportunity that matches my career goals Declines in compensation offered (including non-cash comp.) Concerns about market instability/state of economy 35% 43% 86% Global executives report concerns about inability to find opportunities that match their career goals (86%), as well as declines in compensation (43%), as the top two concerns that would most hinder them from making a career move in Inability to relocate due to real estate market 8% General aversion to risk 8% Making a Career Move in The Positives Better role/increased responsibility Increased total compensation (including non-cash comp.) Better work environment Better work-life balance 23% 21% 64% 60% 64% of global executives would be most enticed by a career move in 2014 if it meant a move to a better role and/or increased responsibility. 60% of executives report that increased total compensation would most entice them to make a career move in Opportunity for overseas relocation 16% Change to a more stable industry 13%

15 15 Executive Mobility Regional Outlook for Executive Mobility in 2014 Based on the percentage of executives reporting their willingness to make a career move in 2014 Region More Willing Less Willing No Change ASEAN 64% 36% 0% Australia/New Zealand 83% 0% 17% Brazil 92% 8% 0% Canada 80% 10% 10% CEEC 79% 7% 14% Central/South America 67% 11% 22% China 86% 14% 0% Continental Europe 72% 2% 26% Germany 75% 13% 13% India 85% 8% 8% Middle East 16% 2% 3% UK 55% 0% 45% US 71% 5% 24% Sector Outlook for Executive Mobility in 2014 Based on the percentage of executives reporting their willingness to make a career move in 2014 Sector More Willing Less Willing No Change Energy/Natural Resources 91% 4% 4% Financial Services 68% 12% 20% Healthcare/Life Sciences 57% 11% 32% Hospitality/Tourism 86% 14% 0% Insurance 75% 0% 25% Manufacturing/Industrial 77% 5% 18% Media/Entertainment/Advertising/PR 50% 17% 33% Not-for-Profit/ 73% 13% 13% Public Sector/Education Professional Services 67% 8% 25% Technology/Telecoms 75% 4% 21%

16 16 Executive Compensation 2014 Expected Total Compensation Among Global Executives 39% 53% Increase Decrease Stay the same 8% 53% of global executives expect their total compensation to increase in 2014, while 39% expect no change in total compensation this year. Only 8% of global executives expect a decrease in their total compensation in Executives overall compensation outlook for 2014 is 6% more positive than it was for Last year, 47% of global executives expected their total compensation to increase, while 42% expected no change in total compensation this year. Only 11% of global executives expected a decrease in their total compensation in 2013.

17 17 Executive Compensation 2014 Expected Total Compensation - Increases + 46% or higher % % % 5% 2% 3% 6% Of those global executives expecting an increase in their total compensation in 2014, the greatest percentage (32%) expect to see a 6-10% increase % % % 12% 21% 32% At this time last year, most respondents (29%) were expecting a 1-5% increase in total compensation in % 19% 2014 Expected Total Compensation - Decreases - 46% or higher 17% % 0% % 0% % 13% Of those global executives expecting a decrease in their total compensation in 2014, the greatest percentage (25%) expect to see a 16-20% decrease % 25% % 13% % 21% - 1-5% 13%

18 18 Regional Outlook for Executive Compensation in 2014 Based on the percentage of executives reporting expected changes to their total compensation in 2014 Region Increase Decrease Stay the same ASEAN 64% 0% 36% Australia/New Zealand 17% 33% 50% Brazil 69% 0% 31% Canada 70% 0% 30% CEEC 64% 7% 29% Central/South America 44% 11% 44% China 100% 0% 0% Continental Europe 31% 11% 57% Germany 63% 0% 38% India 69% 8% 23% Middle East 52% 14% 33% UK 64% 0% 36% US 52% 8% 40% Sector Outlook for Executive Compensation in 2014 Based on the percentage of executives reporting expected changes to their total compensation in 2014 Sector Increase Decrease Stay the same Energy/Natural Resources 65% 0% 35% Financial Services 40% 16% 44% Healthcare/Life Sciences 54% 11% 25% Hospitality/Tourism 71% 0% 29% Insurance 50% 0% 50% Manufacturing/Industrial 46% 2% 40% Media/Entertainment/ 33% 0% 67% Advertising/PR Not-for-Profit/ 33% 0% 67% Public Sector/Education Professional Services 60% 14% 26% Technology/Telecoms 50% 13% 37%

19 19 Executive Opportunities Finding a New Executive Opportunity 1% 6% 8% 54% 31% Very difficult Difficult Neutral Easy Very easy The greatest percentage of global executives (54%) expect 2014 to be as difficult as 2013 for finding new executive opportunities. 39% of global executives expect it to be more difficult to find an executive opportunity in 2014 than it was in 2013, while only 7% expect 2014 to be an easier year than 2013 for finding a new executive position. Comments about finding new executive opportunities included: Even though there currently appears to be an abundance of career opportunities, there are still a large number of qualified candidates. Competition remains stiff. Being based in the Middle East, one sees a major skills shortage. To meet the demands of most sectors in the market, particularly with regional governments, spending is dramatically accelerating in the coming five years.

20 20 Executive Opportunities Timeline for Finding a New Executive Opportunity in 2014 More than 2 years 1-2 years 2% 10% The greatest percentage of global executives (45%) expect the average timeline for finding a new executive opportunity in 2014 to be 6-12 months months 3-6 months 31% 45% This is the same as executives estimate from last year when 41% expected the same average timeline for Less than 3 months 8% Global Executives on the 2014 Hiring Plans for Their Companies We plan to increase the number of employees 37% We plan to maintain the same number of employees 31% We plan to decrease the number of employees 24% I don't know 8%

21 21 The Global War for Talent Top Markets Expected to Experience a Talent Shortage in 2014 Based on the percentage of executives reporting a specific market as one that will experience a talent shortage in 2014 US 49% China 37% Middle East 21% Brazil 20% Latin America 20% ASEAN 19% India 19% Africa 18% CEEC 12% Continental Europe 11% Canada 10% UK 9% Australia/New Zealand 7% Russia 7% Other 2% Japan 1% Global senior executives rank the US, followed by China and the Middle East as the top three markets that will experience a talent shortage in 2014.

22 22 Top Sectors Expected to Experience a Talent Shortage in 2014 Based on the percentage of executives reporting a specific sector as one that will experience a talent shortage in 2014 Technology/Telecoms 62% Healthcare/Life Sciences 45% Energy/Natural Resources 44% Manufacturing/Industrial 36% Professional Services 26% Financial Services 21% Not for Profit/Public Sector/Education 8% Hospitality/Tourism 7% Media/Entertainment/Advertising/PR 6% Insurance 4% Other 3% Global senior executives rank technology/telecoms, followed by healthcare/life sciences and energy/natural resources as the top three sectors that will experience a talent shortage in 2014.

23 BlueSteps Executive Compensation Report Executive Search Industry vs. Executive Job Market Outlook Executive Outlook 64% 51% 13% Executive Search Outlook 36% 33% 3% By comparing the AESC Executive Search Industry Outlook Report (169 responses from AESC executive search consultants in December 2013) to the BlueSteps Executive Outlook Report, it is apparent that the majority of both executive search consultants and senior-level executives have a positive outlook for Similar to the results of this BlueSteps Outlook Report, executive search consultants outlook for 2014 is much more positive (+29%) than for Positive Negative Neutral Mobility Executive Outlook 74% 66% More willing to make a move in % 31% No change expected Executive Search Outlook 7% 2% Less willing to make a move When comparing the results from both the AESC Executive Search Industry Report and the BlueSteps Executive Outlook Report, the findings show that the outlook of search consultants and senior executives is closely aligned, although there may be a greater number of executives willing to consider a move than search consultants believe. While these results indicate that a large number of executives would consider a move, there are of course many factors that contribute towards an individual changing his or her role. *For AESC member data we combined the two data sets of Candidates will be more willing to make a career move (35%) and Candidates will only consider a career move if there is exceptional financial and employment security offered at the new position (31%) to create the total percentage shown in this chart.

24 About BlueSteps.com BlueSteps.com is an online career management service for global senior executives. As an exclusive service of the Association of Executive Search Consultants (AESC), BlueSteps enables senior executives to make their career profile accessible to over 8,000 retained executive search professionals in more than 75 countries who are members of the AESC, and use the database as an additional resource in their candidate and source identification process. BlueSteps members can stay informed of executive job market trends and news via the BlueSteps Career Library and Blog, and use a variety of tools and resources to facilitate the successful management of their executive career path. Click here for more information or visit: BlueSteps.com. About The Association of Executive Search Consultants The Association of Executive Search Consultants (AESC) is the worldwide professional association for the retained executive search sector. The AESC promotes the highest professional standards in retained executive search consulting, broadens public understanding of the executive search process, and serves as an advocate for the interests of its member firms. For more information, or to download the AESC Code of Ethics and Professional Practice Guidelines, please visit About Executive Search Connect The AESC also offers a service for the HR community offering sector information and tools to assist with senior executive recruiting, including access to the AESC membership directory. 425 Fifth Avenue, 4th Floor New York, NY Phone: 1 (800) info@bluesteps.com Web: Share the Report