Walker Webcast: SpencerStuart’s Thomas Daniels: Leadership, Compensation, ESG and the Great Resignation

In March 2022, Christina Coplen with human capital consultant SpencerStuart published “Going Deeper: Why the Future of Leadership is Beneath the Surface” on the company’s website. The article indicated that effective leaders release the need to command and control, and instead focus on the underlying skills that include adaptability, collaboration, engagement—and especially empathy and humility.

During the June 1, 2022 Walker Webcast, SpencerStuart Senior Director/Partner Thomas Daniels chatted with Walker & Dunlop Chairman and CEO Willy Walker about that article. The range of topics also discussed during the hour-long webcast included executive compensation (such as CEO pay), board of director expansion and tenure, what makes an ideal chief financial officer, social media research when vetting potential job candidates, and the explosion in the corporate ESG focus.

Then there was the back-and-forth about the CEO of today. When Walker questioned the results of another SpencerStuart piece – “Prioritizing Experience,” which indicated “no discernable link between prior board or CEO experience and greater shareholder return,” Daniels clarified the issue by indicating that “you can’t make assumptions that just because people have the experience, that they’re going to be more successful than those that maybe haven’t done it.” He went on to say that 70% of CEOs, especially those involved with the S&P 500 might not have necessarily had that type of experience beforehand. “What we’ve tried to do in our projects is to get clients to realize it’s not necessary to have a ‘check the box’ before, but rather the capabilities and competencies to be able to step up to the role,” he said.

Daniels said that, when evaluating potential CEOs, skillset and experience is certainly important. So is the self-awareness “to recognize and to know what they don’t know.” Then there is learning agility. “That’s really critical,” Daniels said. “So, it’s not just someone who’s been in that role before who is going to use the same playbook. But it’s someone who goes in there, knows how to read a situation, and recalibrate and refine.”

Furthermore, gauging the below-the-surface skills involves more than a cursory look at a resume. A deep drive assessment is essential. Daniels said this might require determining previous roles, situations, contexts, output and end results. The process also requires in-depth executive intelligence interviews, complete with real-time case studies and interactive scenarios.

It also requires references.

“Not just the kind of references someone gives you, but the off-the-record ones,” Daniels said. For example, SpencerStuart has a database with four million people, which is updated 40,000 times a week. That database includes potential candidates and interviews with other individuals. As a result, “I think by the time we actually make a call to someone on a project, we’ve got multiple data points. They’re independent sources that can corroborate certain types of behaviors,” Daniels said. And even if that information isn’t necessarily fresh, “we know who we can call to get independent views about a particular person,” he said.

Along with the discussion about vetting, analyzing and hiring future leaders (and understanding their qualifications), Walker and Daniels discussed the current labor market, which remains tight. Daniels pointed out the acceleration of retirements, partly due to COVID and partly because people are simply fed up. “People in a lot of surveys are saying they’re working longer hours, or they’re starting earlier, they’re working later, they’re skipping lunch—and there’s just no end,” he commented.

Daniels also pointed out the mismatch between the number of baby boomers retiring versus the number of Gen Z starting jobs. Along those lines, “if you think about it, a lot of them (Generation Z and millennials) . . . were hired into recessions (during the Great Recession and pandemic-driven recession).” Because these cohorts entered into difficult job markets, “this is really the opportunity for them to take advantage and upgrade,” Daniels observed.

Finally, the pandemic led to a “fundamental reevaluation of how people are thinking about work-life balance and relationships,” Daniels said. Additionally, “we’ve had this great experiment of remote working, and it’s really demonstrated that companies can function well.”

On-demand replays of the June 1, 2022 webcast are available by clicking here and through Walker & Dunlop’s Driven by Insight podcast series.