UK Retail CEO Tracker 2019 - Female CEO appointments on the rise, against a backdrop of fewer overall CEO changes in the past year - Korn Ferry
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
UK Retail CEO Tracker 2019 Female CEO appointments on the rise, against a backdrop of fewer overall CEO changes in the past year.
UK RETAIL CEO TRACKER REPORT 2019
2019 Korn Ferry UK Retail CEO Tracker
Britain remains at the centre of an economic and geopolitical
storm, and most within Retail have never had it so tough.
Consumers have never been more demanding. Competition
from new entrants continues unabated and the talent required
to lead our industry through transformational change is in
short supply.
Our Retail landscape today seems to be split into two: established bricks-
and-mortar retailers struggling to compete in a new world, and pure-play
online retailers who continue to enjoy phenomenal growth, limited only
by their own capacity and resources.
There has never been a more pressing time to develop the next generation
of CEOs who are reflective of the consumer base – agile, diverse and
digitally savvy. This is the seventh Annual Retail CEO Tracker report, which
tracks the changes in CEO moves across the sector, category by category
and year on year. We hope you enjoy reading it.
Author: Sarah Lim
Managing Director & Sector Lead, Retail, EMEA
Korn Ferry International
Contributors: Zoe Duke & Sacha Trimbee
3
2019 UK Retail CEO Tracker
WOMEN RISE
TO THE TOP
Despite the political backdrop and headwinds in the Retail sector,
CEO changes were down 12% from the previous year. Of the newly
appointed CEOs, a quarter were female, representing the most
significant improvement since the Annual Retail CEO Tracker
was first published in 2012.
Introduction
At a macro level, the UK economy grew modestly during 2018, with
figures likely to show growth of about 1.3% for the full year once
released. For the Retail sector, 2018 proved to be one of the most
difficult years on record, with a drop in retail sales, an increasing
number of CVAs, rising costs due to the weakness of sterling,
and the ongoing threat of a no-deal exit from the EU.
Yet irrespective of the unpredictability of both the political and economic landscape,
and seismic change at a sector level, the Retail sector has made a significant
breakthrough in the ratio of female to male CEOs appointed in the past year.
While the overall number of CEOs changing seats dropped from 50 to 44 year
on year, nearly 25% of those CEOs appointed to the sector were female, up from
18% in the previous year. This is the most significant improvement in female CEO
appointments since the Annual Retail CEO Tracker was first published in 2012.
The Annual Retail CEO Tracker follows changes in CEO appointments, analysing
over 200 retailers/brands operating throughout the UK and Ireland, across
all categories. It covers all major brands and retailers, online and physical,
for companies whose revenues are at least £50m per annum or more.
44 CEOs 24%
changed seats, down from of newly appointed CEOs in
50 the previous year the Retail sector were female
4
UK RETAIL CEO TRACKER REPORT 2019
46% of newly appointed
CEOs came from a functional
background in Commercial –
either Sales or Trading/ Buying
and Merchandising.
2018 HIGHLIGHTS:
Five notable findings from this year’s Annual Retail
CEO Tracker:
• There were significantly fewer CEO changes last year
(44) compared with the number in the previous year
(50) – down 12%.
• The percentage of female CEOs appointed has increased
dramatically to 24%; almost one in four CEOs appointed
in the past year were female.
• 37% of CEO changes saw the former CEO in place for
less than three years. In a significant number of these,
the CEO had been changed twice or in some cases three
times in the past three to four years.
• 46% of newly appointed CEOs came from a functional
background in Commercial – either Sales or Trading/
Buying and Merchandising. There was a marked drop-off
in the number of appointed CEOs from a Finance
or Strategy background.
• 55% of all retail CEO changes occurred within the Fashion,
Luxury, Apparel and Department Store Sectors. Yet of the
21 CEOs appointed, only five were internally promoted,
raising the question of whether Fashion and Apparel
businesses are doing enough about succession planning.
Macro factors affecting the Retail sector
• Brexit uncertainty may be a contributing factor as to
why businesses are being more cautious about making
CEO changes.
• The sector continues to undergo seismic transformation
with the shift from high street to online.
• There is a well-publicised uneven playing field from
a taxation standpoint between pure-play online and
traditional bricks-and-mortar retailers.
5
Overall Summary
CEO changes in the past 12 months
Compared to the previous year, 2018 saw a significant
drop of 12% in the number of Retail CEO changes, with
44 announced changes of CEO versus 50 in 2017. Out of
the CEO changes announced, three are yet to be appointed/
announced (Clarks, House of Fraser and N Brown).
Thirteen of the 44 companies that changed CEOs were owned or part-
owned by private equity/VC funds including Permira, Advent, Bain Capital,
Blue Gem, Baring Private Equity Asia, Lion Capital and Bridgepoint.
Fifteen of the companies were private/family/member owned, and the
remainder were either publicly-quoted or part publicly-quoted companies.
Many changes have been driven by:
• ownership change, for example at Belstaff, Farrow & Ball,
Ideal Shopping, Nisa and Jigsaw;
• owner/founder transition, for example at Boohoo, Office,
Oak Furniture Land and The Range;
55%
of CEO changes were in the Fashion,
• broader CEO succession planning, for example at Selfridges Luxury, Apparel and Department
or TM Lewin; and/or poor trading performance. Store sectors.
6
UK RETAIL CEO TRACKER REPORT 2019
Thirteen of the 44 companies that changed CEOs were
owned or part-owned by private equity/VC funds.
Specific sector note CEOs to watch
In the past year, 55% of the CEO changes (24/44) Notable ‘ones to watch’ of the bigger CEO appointments
were in the Fashion, Luxury, Apparel and Department made in the past year include the following:
Store sectors. Only five of these were internal
• John Lyttle, who takes the reins as first-time CEO
appointments: All Saints, Hobbs, Oasis/Warehouse,
at Boohoo in March 2019, with the co-founder joint
Selfridges and Whistles. This inevitably raises two
CEOs transitioning to Executive Chair and Executive
questions: (1) to what extent is this a result of extreme
Director roles respectively;
sector stress, and (2) is this sub-sector of Retail so
poor at succession planning compared to others that • Sebastian James, who joined Walgreens Boots
76% of the CEO appointments in the sector had to be Alliance in September 2018, effectively as the CEO
made externally? for the Boots business, with a brief to reinvigorate
the brand and make advances in digital;
• Alex Baldock at Dixons Carphone, with a significant
76%
job ahead of him to turn around the fortunes of
the mobile business and to fully integrate Dixons
and Carphone;
• Henry Birch who took over from Alex Baldock
of all new CEO appointments in the Fashion, as CEO of Shop Direct.
Luxury, Apparel and Department Store
sectors, were made externally.
Of the rest
Key Grocery sector appointments in the past 12 months CEO Changes by Sub-Sector
were Jason Tarry as UK CEO of Tesco, Kari Daniels as
CEO of Tesco Ireland, and Ken Towle as CEO of Nisa
(part of The Co-op Group).
Notable appointments within Home and Garden in
5%
the past year were Anthony Davey at Farrow & Ball, 6%
Javier Quiñones at IKEA UK, Tim Stacey at DFS and
Terry King at Oak Furniture Land. The Screwfix and 7%
B&Q CEO roles changed again this year (both internal
moves), with John Mewett’s appointment at Screwfix
and Graham Bell’s appointment at B&Q. 50%
Key online CEO appointments in the past 12 months 18%
were Henry Birch at Shop Direct, John Lyttle at Boohoo
and Barrie Seidenberg at Notonthehighstreet.
9%
Fashion, Luxury & Apparel Department Store
Grocery Pureplay
Home & Garden Other
7
Increase in female CEO appointments
While the overall number of CEOs appointed dropped over the past year,
there was a significant percentage increase in the number of female CEOs
appointed – over 24%, up from 6% in the previous year. This is the highest
number in any year since the CEO Tracker started in 2012.
6%
increase in appointments
of female CEOs from 2017
8
UK RETAIL CEO TRACKER REPORT 2019
Female Representation at the Top
24%
76%
Female Male
In the past 12 months, ten of the 41 CEOs appointed Seven-year trend of female CEO
(24.3%) were female. These were: Helen Wright at
appointments in Retail
Belstaff, Melinda Paraie at Cath Kidston, Liz Evans
at Fat Face, Suzanne Harlow at Jack Wills, Barbara The period from 2012 to 2018 shows a small improvement
Campos at Joseph, Erica Vilkauls at LK Bennett, Barrie in the number of women appointed into CEO roles
Seidenberg at Notonthehighstreet, Anne Pitcher at in the industry year by year, but, more significantly,
Selfridges Group, Kari Daniels at Tesco Ireland and a step-up in percentage terms as a whole.
Helen Williamson at Whistles.
Of these ten appointments: Seven Year Trend of Female CEO
• Only three are proven former CEOs – Helen Wright,
Appointments in UK Retail
Liz Evans and Barrie Seidenberg;
• The rest are ‘step up’ candidates in their first true 10 25%
CEO role – either from a divisional MD role, or
from a functional role in Commercial/Buying and
Merchandising. 8 20%
• Sector-wise, with the exception of Kari Daniels at
Tesco Ireland, all have gone into roles in Fashion/
Apparel/Gifting sub-sectors; 6 15%
• All ten have come up through a strong background
in Commercial and Trading/Buying and Merchandising
in their former careers. 4 10%
2 5%
In the past 12 months, ten of
the 41 CEOs appointed (24.3%) 2012 2013 2014 2015 2016 2017 2018
were female. Number of women appointed
Percentage of Total CEO appointments
9
CEO tenure
More than a third (37%) of the CEO changes
made in the past year saw the former
CEO in place for less than three years.
This excludes Boux Avenue, which had no
CEO prior to Michael Kerr’s appointment.
The 16 companies that previously had its CEO for
less than three years were: B&Q, Boots, Charles
Tyrwhitt, Clarks, Crew Clothing, Hobbycraft, House
of Fraser, Joseph, Lacoste UK, LK Bennett, Nisa,
Notonthehighstreet, Pets at Home, The Range,
Screwfix and Whistles. Of these 16 companies,
with a couple of notable exceptions, the majority
have seen rapid change at the top as a result
of company performance/restructuring and/or
friction between investors/owners and the CEO.
In some of these cases, the CEO seat has
changed at least twice in the past three to
four years – at B&Q, Screwfix, LK Bennett, Nisa,
Pets at Home, Hobbycraft, House of Fraser and
Whistles. This churn reflects a combination of
factors, but in particular trading performance
and/or ownership change.
37%
of CEO changes in the last year
saw the former CEO in place for
less than three years
10UK RETAIL CEO TRACKER REPORT 2019
unctional heritage of the CEOs appointed
F
in the past 12 months:
Functional Background of the CEOs Appointed
2%
22%
Operations
Finance
Marketing
46% Strategy
15% Commercial/Buying/
Merchandising
Other
10%
5%
Of the CEOs appointed in the past 12 months, 46% (19/41) came from a
Commercial/Sales or Trading/Buying and Merchandising background. These
included: Helen Wright (Belstaff), John Lyttle (Boohoo), Michael Kerr (Boux
Avenue), Melinda Paraie (Cath Kidston), Kenny Wilson (Doc Martens), Liz Evans
(Fat Face), Suzanne Harlow (Jack Wills), Barbara Campos (Joseph), Jamie Givens
(Lacoste UK), Erica Vilkauls (LK Bennett), Lorenzo Moretti (Office), Simon Pickering
(Phase Eight), Anne Pitcher (Selfridges) Jason Tarry (Tesco UK), Kari Daniels (Tesco
Ireland) and Helen Williamson (Whistles).
Twenty-two per cent (9/41) came from a Retail/Operations background, including
Graham Bell (B&Q), Michael Stanier (Charles Tyrwhitt), Dominic Jordan (Hobbycraft),
Javier Quiñones (IKEA UK) and Peter Pritchard (Pets at Home). And 10% (4/41) had
a formative career in Brand Marketing, namely: Anthony Davey (Farrow & Ball), Adil
Mehboob-Khan (Liberty of London), Barrie Seidenberg (Notonthehighstreet) and Hash
Ladha (Oasis/Warehouse).
In a marked shift from last year, only 15% (6/41) came via the Finance route into general
management – In 2017, those from Finance and Strategy backgrounds combined made
up 30% of the total of CEOs appointed. Perhaps this indicates a change in view – that
cost restructuring alone will not solve the sector’s issues and that a greater focus
on product, commercial trading and merchandising will be required to navigate the
challenges ahead.
11Internal promotion to CEO
In the past 12 months, the number of CEOs Internal Promotion to CEO
appointed as a result of internal promotion
was broadly similar to the previous year –
41% versus 40%.
The year before, many of the internal appointments were
the drafting in of an existing Chairman or NED to be
caretaker of the CEO seat at a time of change. This year,
the vast majority of the internal appointments made
(17/41) were as a result of either internal promotion or an
41%
internal reshuffle. These included Giles Hurley at Aldi UK,
Tim Stacey at DFS, Justin Hampshire at Hobbs, Helen 59%
Williamson at Whistles, Javier Quiñones at IKEA UK,
Terry King at Oak Furniture Land, Hash Ladha at Oasis/
Warehouse, Peter Pritchard at Pets at Home, Anne Pitcher
at Selfridges Group, Jason Tarry and Kari Daniels at Tesco,
and Onur Köksal at Vision Express.
Internal External
12UK RETAIL CEO TRACKER REPORT 2019
Inside or outside of sector?
3 out of 41
As in 2017, the prevailing trend has been to recruit from within
Retail. Of the 41 appointments made in the past 12 months,
appointments came from outside the
only three came from outside the sector, and all of these
retail sector over the past 12 months
came from Leisure, Gaming or Entertainment. This may be
in order to bring in critical knowledge from sectors which
6
are both adjacent to Retail, but also considered to be
more advanced in their digital approach. These appointees out of 41
were Henry Birch, moving from Betting/Gaming to Shop CEOs were appointed from outside
Direct, Barrie Seidenberg at Notonthehighstreet (formerly the UK in 2018
in Online Travel), and Jamie Martin at Ideal Shopping
(formerly in Broadcasting/Media).
International CEO appointments
Similar to 2017, during 2018 the number of CEOs appointed
from outside the UK was low – only six out of 41 (15%).
This is in stark contrast to five years ago when we saw
14 non-British CEOs appointed in the year.
The international (non-British) CEOs appointed last
year were: Melinda Paraie at Cath Kidston (background
at Coach in the USA), Javier Quiñones at IKEA UK
(internal move), Barbara Campos at Joseph (French,
from a Luxury background), Barrie Seidenberg at
Notonthehighstreet (American, from Online Travel),
Lorenzo Moretti at Office (Italian, formerly Nike
and Gap), and Onur Köksal at Vision Express
(Turkish, an internal transfer from the Grand Vision
parent company).
13Overall outlook for 2019
Despite its challenges, 2018 was a more stable
year in terms of CEO changes, with considerably
fewer moves than in the previous year. It remains
to be seen whether this is the calm before the
storm. With 2019 looking to be a year of heightened
uncertainty – particularly the first half – we predict
a high level of CEO changes. Fasten your seatbelts:
a rollercoaster of a ride beckons in 2019…
Listing of Retail CEO changes during 2018
Company Name New CEOs announced as Company Name New CEOs announced as
appointed during 2018 appointed during 2018
Aldi UK Giles Hurley Jigsaw Chris Stephenson
AllSaints Pete Wood Joseph Barbara Campos
B&Q Graham Bell Lacoste UK Jamie Givens
Belstaff Helen Wright Liberty London Adil Mehboob-Khan
Boohoo John Lyttle * LK Bennett Erica Vilkauls
Boots Sebastian James N Brown TBA
Boux Avenue Michael Kerr Nisa Ken Towle
Cath Kidston Melinda Paraie Notonthehighstreet Barrie Seidenberg
Charles Tyrwhitt Michael Stanier Oak Furniture Land Terry King
Clarks TBA Oasis & Warehouse Group Hash Ladha
Crew Clothing David Butler Office Lorenzo Moretti
DFS Tim Stacey Pets at Home Peter Pritchard
Dixons Carphone Alex Baldock Phase Eight Simon Pickering
Dr Martens Kenny Wilson Screwfix John Mewett
Farrow & Ball Anthony Davey Selfridges Group Anne Pitcher
Fat Face Liz Evans * Shop Direct Henry Birch
Hobbs Justin Hampshire Tesco UK Jason Tarry
Hobbycraft Dominic Jordan Tesco Ireland Kari Daniels
House of Fraser TBA The Range Chris Dawson
Ideal Shopping Direct Jamie Martin TM Lewin Sven Gaede
IKEA Javier Quiñones Vision Express Onur Köksal
Jack Wills Suzanne Harlow Whistles Helen Williamson
*Appointed and announced during 2018 but will start in role during 2019.
14About Korn Ferry Korn Ferry is a global organisational consulting firm. We help companies select and hire top leaders to grow their businesses to maximise shareholder return. Furthermore, we help them design their organisation – the structure, the roles and responsibilities, as well as support how they compensate, develop and motivate their people. Our approximately 7,000 colleagues serve clients in more than 50 countries.
You can also read
