Nicolas Manset shares CHRO Turnover Insights for Middle East region

Russell Reynolds Associates (RRA) recently released its Global CHRO Turnover Index, offering an in-depth look at the latest movements in the world of HR leadership. The report’s findings show that, in Q2 2024, CHRO turnover is starting to stabilise, suggesting that companies around the globe are prioritising retention of their HR leaders to help navigate ongoing talent shortages and market uncertainties.

A particularly positive takeaway is the rising gender diversity in CHRO roles, with women securing 14 of the 25 new appointments in Q2 2024—the highest since 2022. While this is a promising trend, there’s still progress to be made. Another key insight from the report highlights a shift in hiring patterns. Only 36 per cent of CHROs were promoted internally in Q2, a sharp drop from 56 per cent last year, as organisations increasingly seek seasoned external leaders. First-time CHROs also declined, with only 40 per cent being newcomers to the role, compared to 52 per cent in the same period of 2023.

While these trends are playing out globally, we turned to Nicolas Manset, Head of Middle East at Russell Reynolds Associates, to shed light on what CHRO turnover looks like in the Middle East region. 

Read here the edited excerpts: 

What do you believe are the primary factors contributing to the decline in CHRO turnover in Q2 2024? What is the trend in the Middle East region, and how is it impacting organisational stability?

The Middle East is currently experiencing a period of high growth and rapid change, which is putting significant pressure on boards, CEOs, and CHROs to ensure they have the right talent and skills in place. It’s also changing the way that CEOs and CHROs collaborate with one another. They now need to work much more closely to ensure their training and corporate culture can keep pace as the market evolves. 

As a result, CHROs in the Middle East region are more influential now than ever before. They have become one of the CEO’s most important strategic advisors. But they’re also under more pressure to act swiftly, particularly in fast-moving sectors like industry, natural resources, financial services, private capital, and consumer-facing industries such as hospitality and retail. 

While we’re seeing the same decline in CHRO turnover globally, the reasons behind it are different. Here, it’s much more about the need for stability and continuity in a highly volatile market with a greater degree of uncertainty. Boards and CEOs want reassurance that their CHRO will be there to help them successfully navigate the choppy waters that lie ahead. 

There’s a noticeable shift towards external CHRO appointments globally in Q2 2024. Is this trend also present in the Middle East? What are the potential benefits and challenges for organisations in the region when considering external hires versus promoting from within?

Whether we're talking about external or internal hires, the overarching themes are the same:  pace and growth. 

When it comes to hiring externally, there are definite advantages. For example, if the board or CEO feels the current CHRO isn’t capable of implementing the kinds of changes that are needed, an external hire can often bring fresh perspectives and expertise.

However, it’s important when hiring someone from outside the region to consider whether they have the level of cultural understanding that is necessary to succeed in this region. You need someone who not only need knows the business or sector inside out, but also the local customs, ethics, and traditions. Or at the very least, has experience working in countries or cultures beyond their own.

On the other hand, internal hires tend to have a deeper understanding of not just the local culture, but the people and personalities that exist within the business. They may have been part of the organisation for years, so they’re able to provide more reassurance.

But regardless of whether a CHRO is an internal or external hire, they need to be more than just experts in traditional HR functions like employee engagement, talent retention, or recruitment. They need to be a true business partner and strategic advisor, ready and able to contribute to strategic discussions and decisions. 

If a board or CEO says, “We’re not going to have our CHRO on the executive committee,” or “They won’t be part of strategic discussions,” that can be a sign that they don’t take human capital as seriously as they ought to. 

Tell us about the decline in first-time CHRO appointments, underscoring the 'need for steady hands in turbulent times.' How should organisations in the Middle East balance the need for experienced leadership with the development of emerging HR talent?

Given the unique dynamics of the Middle East region right now, I think organisations would be wise to think carefully before appointing a first-time CHRO. While there are potential advantages to hiring a CFO or P&L-holder from within—for example, someone with a deep understanding of the business, its products, channels, and strategies—if that person has never been a CHRO before, it’s going to take them a significant amount of time to fully grasp what it means to lead the HR function.

In more mature markets, hiring first-time CHROs can work well, as they bring fresh ideas and approaches. But in the Middle East, where markets are still evolving, it’s a bold move to hire someone without that experience. However impressive their background may be, it's a question of risk. Appointing a first-time CHRO to a key role in a high-profile organisation is a high-stakes decision, which demands caution. You’ll need to be very clear on why you're making that choice and taking that risk. 

On the other hand, if you’re intentional and transparent about appointing a first-time CHRO because it aligns with your business or brand strategy, it can work—especially if that person is surrounded by a strong, capable team. For example, appointing a former head of a region like Asia Pacific or a P&L-holder from a major business into the CHRO role could be beneficial if their key mandate includes preparing their eventual successor. This succession planning would involve coaching, training, and developing the internal team using advanced tools that assess long-term performance. While this approach could be interesting and even successful for a short period, it remains a higher risk. Given the region’s rapid growth and high level of scrutiny, appointing a first-time CHRO still poses significant challenges.

What strategies do you recommend to improve gender diversity in the CHRO role across regions where women remain underrepresented, such as the Middle East?

While we’re starting to see more women in leadership roles, the pace of change in the Middle East is slower compared to other parts of the world, and there is still a great deal of room for improvement. 

Why should organisations focus on gender diversity? It’s not just about equality, although that is essential. It's also about improving business performance, culture, and employee engagement. Promoting gender diversity can help a company reach a best-in-class status, both regionally and globally. CHROs must understand this and be equipped to drive professional mobility—whether from one role to another or across different geographies.

CHROs also need to be well-versed in modern training and development tools. 

While gender is a key focus, diversity takes many forms, and CHROs must be adept at recognising and nurturing it. But when it comes to women specifically, it’s crucial to give them the opportunities to prove their capabilities. Are they being offered functional roles, business roles, or P&L responsibilities? In any given culture, the number of women in visible leadership positions, such as full P&L, C-suite, or executive roles, often reflects how effectively the CHRO is fostering internal promotion or seeking talent externally.

Our view is that companies need to focus on this early in the talent pipeline—promoting women internally who may lack experience, but can be trained and developed. This approach pays off in the medium to long term. However, if you’re in a situation where you don't have enough internal candidates, you may have to look externally to fill those gaps.

You may also like:

• Addressing employee concerns NOW is the future: Fazeela Gopalani
• Maan Fatani on role of HR in reshaping workforce, culture and business
• Top risks in 2024: What challenges HR leaders face?

How does RRA assist companies in the Middle East with managing CHRO succession planning, especially in light of the findings from the CHRO Turnover Index?

Our role is to support boards, CEOs, and CHROs in developing robust succession pipelines. It starts with building a strong foundation early on. We help create training cohorts and modules that prepare future leaders, exposing them to a range of developmental tools—assessments, coaching, executive education programmes, and specialised training sessions, both short -term and long-term. 

Sending individuals on secondments or international assignments is another way we help broaden their perspectives and skill sets. There are many ways to approach this, but our aim is always to provide a holistic development plan. 

We also ensure that organisations are aware of global trends and help them understand their competitive landscape. For example, if you’re in the automotive industry, do you see yourself competing with Porsche and Aston Martin, or is your peer group more aligned with Peugeot or Volkswagen? It all depends on your market, strategy, and margin objectives.

We help them understand their team, by boldly testing and exposing them to new challenges, and recognising that these efforts take time—thinking in cycles of three, five, or even seven years. 

Another crucial factor is mobility. Do your people want to stay in HR, or do they aspire to P&L or functional roles? Often, we pigeonhole individuals into certain roles, but the world is changing, and so is the Middle East.

We see this transformation every day in the projects we work on with boards, CEOs, and C-suite leaders across the region. The shift is clear, and it’s shaping the future of leadership in a very visible way.

As geopolitical tensions and technological disruptions reshape the HR landscape, what key skills and competencies should CHROs in the Middle East focus on to remain effective in their roles?

CHROs in the Middle East need to focus on exactly the same things as their global counterparts. First and foremost, they need to have a well-rounded perspective. For example, understanding the implications of geopolitical tensions is crucial. What does it mean to work with people from Morocco, Qatar, Egypt, Lebanon, Syria, Jordan, Saudi Arabia, or the UAE? In this region, sensitivities can be heightened, so awareness is key. 

Additionally, CHROs need to grasp the impact of AI and technological disruptions. The Middle East, with its innovation hubs like Dubai, is at the forefront of advancements in areas like crypto and AI. Regulators are emerging in these hotspots, making the region quite progressive in these fields. But it’s critical for CHROs to understand the implications of AI, not just view it as a threat to jobs. If a CHRO dismisses AI as simply job-killing, they’re missing the bigger picture and won’t be able to guide their organisation effectively. They need to reassure their teams, provide training, and help everyone understand AI’s potential—whether in governance or business operations.

And as we’ve already touched on, CHROs also need to be able to think strategically, not just focusing on the operational side of HR (like hiring, retention, and social responsibility). CHROs need to be able to lift their eyes up and see the bigger picture. They should understand how their global counterparts are approaching AI, sustainable leadership, and cybersecurity, even if they aren’t experts in those areas. For example, CHROs must know how cybersecurity impacts their organisation and be able to communicate its importance, especially in a world where digital risks are increasing.

Finally, sustainability is another area where CHROs need to have a view. It’s not just about understanding climate change; it’s about knowing how sustainable leadership practices can drive long-term success. CHROs who grasp this concept are more likely to cultivate leaders who perform better over time.

CHROs in the Middle East need a 360-degree view of all these issues. To do that, they must invest time outside of their immediate responsibilities—whether through networking, continuous learning, or seeking mentorship. A CHRO who is narrowly focused won’t serve their board, CEO, or organisation well. It’s about finding the balance: enough fresh ideas and perspectives to prevent stagnation, but not so much churn that it destabilises the organisation. Sustainable growth comes from steady leadership that can navigate both strategy and execution effectively.