CHRO Market Trends between 2012 and 2019: The Experiences That Rise to the TopRussell Reynolds does almost 300 HR searches per year and conducts analyticsstudies around the top performers, both CHROs and their HR teams. Everysearch is at the executive level: HR business partners to CHROs, heads of rewards to CROs and talent heads to chief talent officers. We are fortunate to have a bird’s-eye view of what’s working now, and we would like to share with you some of our key observations about CHROs.

What Are the Trends in CHRO Hiring?

Today, the world’s best CHROs match talent solutions to commercialstrategy in addition to effective and efficient people management. So where does this expertise come from? What route did they take to the top seat in people leadership?

Our research into these questions began in 2012. The goal of our first Route to the Top study was to reveal the backgrounds and experiences of the CHROs in the Fortune 100 (F100). We reran the study in the summer of 2019, this time for the F100 and the Fortune 500 (F500). We want to share the trends we uncovered over time and the impact they may have on your internal succession process or your initial thinking for a search.

Whether firms followed a successful succession process or went outside to find their next CHRO changed only slightly.

While the F500 cohort was 8 percent more likely than the Fortune 100 to go outside for a CHRO, in the F100, the number of CHROs externally recruited dropped slightly from 36 percent in 2012 to 35 percent in 2019.

The same slight move toward internal appointments occurred in the Fortune 500: 44 percent before and 42 percent a�er 2017.

02 Succession Planning Is More Successful in the F100

A quick internal rise to CHRO a�er less than three years has always been elusive. The cohort with more than 11 years of experience andless than 20 is now the largest, and the central range for internal hires, at 37 percent.

New internally hired CHROs with four to ten years of experience remained similar in percentage between 2012 and 2019 (23 percent vs. 24 percent). The number of CHROs hired with more than twenty years at their firm dropped from 36 percent in 2012 to 28 percent in 2019.

01 Internal Hires Are Most Likely to Have 10 to 20 Years of Experience

12%2012

2019

1–3 4–10 11–20 over 20

23%

11% 24%

29%

37%

36%

28%

35%44% 42%

36%

Pre-2017 Since 201720192012

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In 2012, 64 percent of F100 external hires had previous CHRO experience. In 2019, the number jumped to 81 percent. Same-sector experience in external hires rose significantly as well, moving from 58 percent to 73 percent. For comparison, in the F500, 68 percent of external hires have previous CHRO experience.

F100 external hires with same-sector

experience

F100 external hires with previous CHRO

experience

20192012

64%

20192012

58%73%81%

03 More F100 External Hires Have CHRO Experience in the Same Sector

A move toward female leaders occurred over the past seven years. In 2012, 40 percent of CHROs were female, which jumped to 66 percent in 2019. In 2019, the number for the F500 supports the trend at 61 percent, and the pa�ern strengthens when breaking down F500 hires before and a�er 2017. Before 2017, 57 percent were women versus 65 percent of hires in 2017 and a�er.

In a significant shi�, 76 percent of F100 CHROs have generalist experience in 2019, an increase of 33 percent from 2012 (57 percent).

05 Three Out of Four F100 CHROs Have HR Generalist Experience

04 More and More CHROs Are Women

CMO Compliance GC CFO CEO

40%

CHRO

38% 34%16% 8%

2012 2019

76%57%

CHROs also trend female significantly more than their C-suite colleagues. Comparing percentages from 2019, the percentage of female officers in the F100 were:

66%

06 The F100 Mix of Previous Experience Leans Further toward Business

In 2012, 21 percent of CHROs had finance experience. That number dropped by over half to 9 percent in 2019. That is, however, the only previously held role that shrank. Management consulting nearly doubled from 12 percent in 2012 to 22 percent in 2019. International assignments and general management rose slightly to 30 percent (up 1 percent) and 29 percent (up 2 percent). But when we ran the numbers on appointments pre and post 2017, general management and international experience skyrocket. Fi�y percent of appointees have international experience versus 6 percent of those hired before 2017, and 34 percent have GM experience versus 21 percent for pre-2017 hires. Every business experience except corporate communications had more representation in the post-2017 cohort.

Finance2012 2019

21%

9%

ManagementConsulting

2012 2019

12%22%

InternationalAssignments

2012 2019

29% 30%

GeneralManagement

2012 2019

27% 29%

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Summary

Firms in the F100 are more likely to promote from within. As they do, they look to business experts who also have HR generalist experience. Firms go outside when they need a fresh look at their people strategy, and those leaders overwhelmingly have generalist experience and have been CHROs, o�en in the same industry. Experiences like recruiting and finance are less important to firms in 2019, but experiences like international exposure, general management and management consulting are more important than ever. Finally, more and more women are reaching the CHRO spot, a trend that needs deeper investigation to clarify its source.

More and More CHROs Are Women07 Recruiting Experience Is Shrinking among F100 CHROs

When businesses struggle, they need a new strategy of bringing in talent from the outside.

For F100 firms’ external hires, 90 percent have HR generalist experience (vs. 64 percent internal), and 82 percent have been CHROs (vs. 4 percent internal).

09 External Hires Have More HR Experience, Especially CHRO

When business is going well, organizations that already have the right talent promote leaders who have business experience. In 2019, management consulting is the only business experience where external hires (30 percent) have more experience than internal hires (17 percent). Internal hires are more likely to have experience in international assignments (35 percent vs. 26 percent), sales and marketing (23 percent vs. 11 percent), finance (13 percent vs. 4 percent), general management (32 percent vs. 26 percent), and corporate communications (10 percent vs. 4 percent).

08 Internal Hires Have More Business Experience

ManagementConsulting

ExternalInternal30%

17%

InternationalAssignments

35%

26%

Sales &Marketing

23%

11%

Finance

13%

4%

GeneralManagement

32%26%

CorporateCommunications

10%4%

Recruiting experience is now a less common trait, down from 32 percent to 19 percent.

32% 19%

InternalExternal

90%

64%

HR GENERALIST

4%

82%CHRO EXPERIENCE

InternalExternal

© Copyright 2019, Russell Reynolds Associates. All rights reserved. This material may not be copied, reproduced or redistributed, in whole or in part, without the prior express wri�en consent of Russell Reynolds Associates.

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