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UK Executive Search Market Report 19th Edition

Methodology

September 2019

 

Methodology

 

 

By Anna Weston - Executive Director of Research

This is the 19th Edition of Executive Grapevine’s annual report into the activity of the Retained Executive Search Market in the UK. A broad range of operating and ownership models exist in this industry: encompassing publicly quoted international firms together with global partnerships and small highly specialised boutiques. The activity of all these firms is included in this report.

However, the report only analyses firms that exclusively focus on assignments for executive, or non-executive, positions with guaranteed first year remuneration above £100k. Some well-known recruitment companies, with specialist senior divisions, were unable to split out their work at senior levels and therefore these companies have not been included. Furthermore, the report includes only those firms working on a retainer basis using a research methodology. This ensures that only firms of a similar profile are compared. It also captures the strategic aspects of senior search work in comparison to the more transactional approach taken for mid-and-junior level assignments. Firms included also tend to have minimum fees and work largely on a retained only basis. By combining assignment salary level, retained fee structure and research basis, this report captures the vast majority of the market activity for UK senior level hires. The report therefore covers Executive and Non-Executive Roles, C-Suite and Director Levels. It also covers non-management roles where the salary levels permit the use of professional search.

To ensure all those included are compared on an equal basis, firms are asked to provide their Net Fee Income (NFI) for the financial year 1st April 2018 to 31st March 2019. NFI includes fees earned solely from retained executive search assignments billable, transacted or originated by consultants based in the UK. A portion of foreign earnings is included if it relates to work carried out by UK-based consultants. Fees paid for any other value-added services e.g. Leadership Consulting, Board Evaluation or Interim Management fees, advertising or expenses are excluded. The total figure is then split into two separate markets: those assignments with first year guaranteed compensation above £200k (NED roles are also included in these tables) and those where the compensation is below this level. These figures are then expressed as a % share of the market. The total market is defined as those companies represented within the report.

Due to the sensitive nature of this analysis, Executive Grapevine guarantees not to make public the source data provided. In the very small number of instances where firms choose not to reveal their NFI an estimate has been used. Where estimates are listed, it is largely due to firms being unable to separately record the activity of their practice groups by industry sector. This year we received detailed disclosure from over 90% of the participants in the report, making it the most accurate map of the executive search industry ever produced. All submissions made by firms appearing in this report are pressure-tested against the Grapevine Industry Analyser™, a proprietary statistical model that we have used over the last 18 years. This models the NFI of every single individual assignment included in the report and then evaluates the result against the information submitted from the companies themselves. We do not use data from Companies House. Where a statistically significant difference exists, we work with firms to remove them.

For Multi Practice Firms, defined as those where no single practice contributed more than 70% of NFI, income has been split into eight broad industry sectors: Global Banking and Markets & Asset Management; Retail Financial Services; Industrial; Consumer; Media and Healthcare; Technology & Telecoms; Professional & Business Services; Pharmaceuticals & Life Sciences; and Government; and Not-for-Profit & Third Sector. For Boutique Firms (i.e. where a single practice contributed 70% or more of NFI) we have been able to produce Global Banking and Markets as a separate table from Asset Management.

Where firms have specialist functional groups, they have been allocated into an industry sector accordingly. The assignments have then been split into Board, NED & Leadership roles, with salary, or pro rata compensation at £200k plus, and a second group of Senior Management roles with compensation under £200k

Growth rates wherever expressed are quoted on a like-for-like basis.

Return to the Market Report

Methodology

By Anna Weston - Executive Director of Research

This is the 19th Edition of Executive Grapevine’s annual report into the activity of the Retained Executive Search Market in the UK. A broad range of operating and ownership models exist in this industry: encompassing publicly quoted international firms together with global partnerships and small highly specialised boutiques. The activity of all these firms is included in this report.

However, the report only analyses firms that exclusively focus on assignments for executive, or non-executive, positions with guaranteed first year remuneration above £100k. Some well-known recruitment companies, with specialist senior divisions, were unable to split out their work at senior levels and therefore these companies have not been included. Furthermore, the report includes only those firms working on a retainer basis using a research methodology. This ensures that only firms of a similar profile are compared. It also captures the strategic aspects of senior search work in comparison to the more transactional approach taken for mid-and-junior level assignments. Firms included also tend to have minimum fees and work largely on a retained only basis. By combining assignment salary level, retained fee structure and research basis, this report captures the vast majority of the market activity for UK senior level hires. The report therefore covers Executive and Non-Executive Roles, C-Suite and Director Levels. It also covers non-management roles where the salary levels permit the use of professional search.

To ensure all those included are compared on an equal basis, firms are asked to provide their Net Fee Income (NFI) for the financial year 1st April 2018 to 31st March 2019. NFI includes fees earned solely from retained executive search assignments billable, transacted or originated by consultants based in the UK. A portion of foreign earnings is included if it relates to work carried out by UK-based consultants. Fees paid for any other value-added services e.g. Leadership Consulting, Board Evaluation or Interim Management fees, advertising or expenses are excluded. The total figure is then split into two separate markets: those assignments with first year guaranteed compensation above £200k (NED roles are also included in these tables) and those where the compensation is below this level. These figures are then expressed as a % share of the market. The total market is defined as those companies represented within the report.

Due to the sensitive nature of this analysis, Executive Grapevine guarantees not to make public the source data provided. In the very small number of instances where firms choose not to reveal their NFI an estimate has been used. Where estimates are listed, it is largely due to firms being unable to separately record the activity of their practice groups by industry sector. This year we received detailed disclosure from over 90% of the participants in the report, making it the most accurate map of the executive search industry ever produced. All submissions made by firms appearing in this report are pressure-tested against the Grapevine Industry Analyser™, a proprietary statistical model that we have used over the last 18 years. This models the NFI of every single individual assignment included in the report and then evaluates the result against the information submitted from the companies themselves. We do not use data from Companies House. Where a statistically significant difference exists, we work with firms to remove them.

For Multi Practice Firms, defined as those where no single practice contributed more than 70% of NFI, income has been split into eight broad industry sectors: Global Banking and Markets & Asset Management; Retail Financial Services; Industrial; Consumer; Media and Healthcare; Technology & Telecoms; Professional & Business Services; Pharmaceuticals & Life Sciences; and Government; and Not-for-Profit & Third Sector. For Boutique Firms (i.e. where a single practice contributed 70% or more of NFI) we have been able to produce Global Banking and Markets as a separate table from Asset Management.

Where firms have specialist functional groups, they have been allocated into an industry sector accordingly. The assignments have then been split into Board, NED & Leadership roles, with salary, or pro rata compensation at £200k plus, and a second group of Senior Management roles with compensation under £200k

Growth rates wherever expressed are quoted on a like-for-like basis.

Return to the Market Report