Failing the Grade: Investors World-Wide Say Current Corporate Leadership is ‘Unfit’ for Future, a Major Korn Ferry Study Finds

--‘Self-Disruptive Leader’ Study Reveals That Fewer Than Two in Ten Corporate Leaders Have the Skills Required to Take Their Companies Into the Future --

Los Angeles, March 12, 2019 – According to an extensive Korn Ferry (NYSE: KFY) study – capturing the sentiment of nearly 800 investors and including a detailed analysis of more than 150,000 leaders – corporate leadership is ill-prepared to meet the challenges of tomorrow.

As part of Korn Ferry’s comprehensive Self-Disruptive Leader* study, 795 investors were queried in a global survey. The result: two thirds (67 percent) say that today’s private-sector leadership is “unfit” for the future.

Globally, 67% of investors believe the current leadership stock is not fit for the future. Following are percentages for each country in the study.

  • Australia - 64%
  • Brazil - 72% 
  • China - 82% 
  • France - 64% 
  • Germany - 48% 
  • Hong Kong - 54%
  • India -  72%
  • Indonesia -  60% 
  • Japan - 80% 
  • Malaysia - 77% 
  • Mexico - 71% 
  • Poland - 66%
  • Saudi Arabia - 68% 
  • Singapore - 51%
  • South Africa - 77% 
  • The Netherlands - 58% 
  • UK - 72%
  • USA - 70%

This is concerning, given the importance of corporate leadership to investors: 78 percent insist the CEO is critically important when deciding in which companies to invest, and 83 percent cite an exceptional CEO as critical to an organization’s success in disruptive times.

Investors see the intense need for future-ready leaders, with two-thirds (66 percent) saying they value future vision and orientation over past performance. Sixty-nine percent say the need for transformation is going to make leadership more important to company performance within the next three years.This is concerning, given the importance of corporate leadership to investors: 78 percent insist the CEO is critically important when deciding in which companies to invest, and 83 percent cite an exceptional CEO as critical to an organization’s success in disruptive times.

As part of the global Self-Disruptive Leader study (and further validating investor sentiment), Korn Ferry delved into 150,000 leadership profiles worldwide. The results were even more staggering: The analysis revealed that, on average, only 15 percent of executives across the globe have what it takes be truly great leaders in the rapidly-changing business world.

Proportion of Self-Disruptive Leaders by market

  • Hong Kong - 17%
  • Poland - 17%
  • Singapore - 17%
  • India - 17%
  • German - 16%
  • Japan - 16%
  • Netherlands - 16%
  • US - 15%
  • UK - 15%
  • Australia - 15%
  • Mexico - 14%
  • France - 14%
  • Saudi Arabia - 14%
  • Indonesia - 14%
  • China - 13%
  • Brazil - 13%
  • South Africa - 13%
  • Malaysia - 12%

The data show that a majority of leaders can’t make decisions and take smart actions quickly enough, motivate people effectively, or build trust—all of which is needed to ensure their organization’s survival into the future.

“Companies have a crucial role to play in cultivating leaders of the future. To close the leadership gap, businesses urgently need to revolutionize how they uncover future execs who have what it takes—and accelerate their growth, as well as build a culture that empowers talent at all levels to challenge and innovate,” said Korn Ferry Senior Client Partner Khoi Tu.

According to The Self-Disruptive Leader study, a new model of future-ready leadership is required. Building on existing concepts of agile, digital and inclusive leadership, Self-Disruptive Leaders also possess a strong portfolio of future-oriented skills: the ADAPT dimensions* – which encompass the ability to anticipate, drive, accelerate, partner and trust.

“For the last hundred years, leaders have been taught that control, consistency, and closure are the principles of business leadership. But dramatic changes to the global business environment mean that this is no longer sufficient—trust, purpose and energizing others are now central,” says Dennis Baltzley, Korn Ferry’s global solution leader for leadership development and co-author of the new report, The Self-Disruptive Leader.

The study argues that today’s disruptive forces in technology, globalization, demographics and consumer behavior are exposing the limitations of legacy leadership worldwide.

“As we accelerate further into the age of disruptive technology, competitor landscapes are evolving more quickly than ever before,” said Tu. “Self-Disruptive Leaders who can continually adapt to keep pace with the market are the key to success in today’s disruptive environment, but not all business leaders are ready for the challenge.”

For further information:

Tracy Kurschner Tracy.kurschner@kornferry.com 1.612.309.3957

About The Self-Disruptive Leader Study

The Korn Ferry Self Disruptive Leader study is based on proprietary data and opinion research. The Korn Ferry Institute (KFI) mapped existing assessment constructs using machine learning factor analysis to determine which skills best forecast future success. This analysis defined the five leadership qualities for future leaders: the ADAPT dimensions.

*The ADAPT dimensions encompass the ability to anticipate, drive, accelerate, partner and trust:

  • Anticipate: Demonstrate contextual intelligence to make quick judgments and create opportunities; focus on the societal needs that the organization wants to serve; provide a direction to unify collective efforts even among disoriented environments.
  • Drive: Energize people by fostering a sense of purpose; manage the mental and physical energy of themselves and others; nurture a positive environment to keep people hopeful, and optimistic, and intrinsically motivated.
  • Accelerate: Manage the flow of knowledge to produce constant innovation and the desired business outcomes; use agile processes, quick prototyping and iterative approaches to rapidly implement and commercialize ideas.
  • Partner: Connect and form partnerships across increasingly permeable functional and organizational boundaries; enable the exchange of ideas; combine complementary capabilities to enable high performance.
  • Trust: Form a new relationship between the organization and the individual that centers on mutual growth; integrate diverse perspectives and values; help individuals to uncover their sense of purpose and facilitate them in providing their maximum contribution.

Leadership scores were aggregated at a country level and linked to the Global Innovation Index, finding statistically significant and practical correlations between the five leadership dimensions and the Index.

KFI proprietary leadership assessment data is based on more than 150,000 participants and 18 major world markets (Australia, Brazil, China, France, Germany, Hong Kong, India, Indonesia, Japan, Malaysia, Mexico, Poland, Saudi Arabia, Singapore, South Africa, The Netherlands, UK, USA) in three knowledge-intensive sectors (Financial and Business Services, Technology, Media and Telecoms, Manufacturing).

Opinion research was then conducted with 795 investors and analysts from the same 18 markets. The sample included experts from asset management firms with global assets under management (AUM) of at least $1 billion (the minimum was higher in larger markets like the United States). Of the top 400 Global Asset Management companies listed by AUM, 66 percent took part in the research, representing $50 trillion of AUM (at time of publication), and the research focused on the world’s largest investors — within the top 50 companies by AUM, the research penetration was 85 percent.

Full methodology can be found in The Self-Disruptive Leader report.

About Korn Ferry

Korn Ferry is a global organizational consulting firm. We help clients synchronize strategy and talent to drive superior performance. We work with organizations to design their structures, roles, and responsibilities. We help them hire the right people to bring their strategy to life. And we advise them on how to reward, develop, and motivate their people.