‘Self-serving myth’ of global talent pool for CEOs

The justification frequently given for extremely high pay rates among company executives is a 'self-serving myth', according to the findings of a think-tank study. It says there is little or no evidence for the notion of a 'global talent pool', where high pay is supposedly needed to attract the best candidates.

The study draws on data from the 'Fortune Global 500' of CEO appointments from the largest companies in the world.

Key findings

  • Only four chief executives out of 489 were poached while working as CEOs of another company in a foreign country – just 0.8 per cent of total appointments. 80 per cent were promoted from within the company.
  • Only one CEO was poached while CEO of another company in another continent.
  • In North America, Japan, Latin America and eastern Europe not a single CEO was found to have been appointed from outside the country where the company was based.
  • Just 6.5 per cent (32) of existing CEOs were poached from another company while serving as a CEO.

The author concludes that the evidence in the report should serve to deflate what seems to be an 'enduring, and self-interested, myth'.

Source: David Bolchover, Global CEO Appointments: A Very Domestic Issue, High Pay Centre
Links: Report | Summary