Ethics of Headhunting
Structure
Business Ethics
Corporate Social Responsibility
Social responsibility frameworks
Personal recruitment
External recruitment
Executive search
What are the choices facing organizations? What are the consequences?
Inductive and deductive approach
Conduct of research
Pilot test
Findings of the primary research
Further research suggestions
Is Headhunting Ethical? An Evaluation of Ethical Recruitment of Top Executives
Today, executive recruiting is a healthy profession – profit margins are high, the industry is growing, salaries are climbing and the hours aren’t too tough (Fitzwilliam, 1998). The phenomenal growth in the executive search service worldwide (Jenn, 1994; Jones, 1995) has generated strong interests regarding the ethical conduct of search consultants (Nash, 1989). On the one hand, Nash (1989) has argued that executive search service may be an unethical business because it encourages competitors to poach qualified employees from one another. On the other hand, companies that sell their product in public especially have to care about a good reputation to maintain or increase the sales volumes and get a good profit. How can both sides agree with each other? Nevertheless, companies have a demand for qualified persons to fill specific management positions. An external consultancy seems to be the most efficient way to staff these vacant positions. Throughout this recruitment process, various actions demand respect for the people and organizations involved, which are the firm in search of an executive, the candidate and the firm currently employing the candidate. By comparing several persons with their individual needs and their different responsibilities there are always ethical borders that are required to satisfy all demands and to consider all circumstances by recruiting especially top executives for high-donated positions.
Aim of the dissertation
External personnel recruitment is one important opportunity for companies to fill vacant positions in the upper or decision-making management. For big companies it is often the only way to get new staff with the right skills and the needed experience. Therefore, consultancy companies specialise in only this sector of recruitment, the executive search. These firms aim for high profit margins by finding suitable candidates for the demanding companies. In the process of bringing the two parties in contact, specific ethical attitudes may clash. This dissertation intends to answer especially the following questions:
What is meant by business ethics and values? How is CSR practised -can you provide examples of best practice?
What are the ethical challenges in recruiting? Conflicts between ethics and profits?
What is meant by the code of ethics?
Where does recruiting end and manipulating start? Can headhuntig ever be ethical could there be agreed guidelines?
Would “an ethical organization” prohibit headhunting?
By answering these questions, the dissertation will bring theory and practice together and add to the growing literature on this subject. The goal is whether or not to justify the tenability of an ethical company dealing with headhunters.
Relationship to previous work
The main focus of this dissertation is to identify the range and variety of ethical issues in business and management recruitment that includes defining an ethical oganization by examining ethical recruitment. Some writers (Vardy and Grosch, 1999 and Taylor, 2001) differentiate between the terms ethics and morality to point out the contrast between them. Ethics are focused on doing good. Morality in contrast is a concern for justice, which is about preventing wrongs and making restitution if wrongs are done (Fisher and Lovell, 2006). The questions today are less about why ethics are or why should they be a part of business. They are more about which values and principles should guide business decisions and how ethics should be integrated within business (Hartman and DesJardins, 2008). By answering the key question, the dissertation will especially concentrate on the ethics of companies that use an executive search service to lead their recruitment process.
Therefore, ethics, closely aligned with integrity must be a primary consideration (Cohen, 2001). To find a way to agree with the company’s behaviour and the poaching process of the ordered executive search consultancy is exactly the task of the dissertation. The work of an executive search consultancy involves a mutual undertaking of a promissory nature by the client company and the consultant to find a suitable candidate for a certain position (Byrne, 1986). To understand this statement, it is necessary to make exactly clear what the work of a headhunter is. Journal articles are talking about the ethical challenges of consulting (White, 1986) especially for consultancies and the examination of the company’s view there is a statement that ethical managers make their own rules (Harvard Business Review, Fall-Winter 1986) or talking about an ethical game (the Economist, February 1988). But in recent years the headhunting industry as well as discussion on business behaviour has become bigger in scale. Generally, companies have both praise and criticism for headhunters (Perkins, 1991). To find out what is meant with praise and criticism, the dissertation will review the literature and the journals and relate them to present opinions about business ethics and third party recruitment.
Methodology
Methodical background will be desk research and field research. Desk research will focus on examining the literature. Field research will use an interview with executives who are allowed to hire people for their company and know how to act within the scope of their company’s corporate behaviour. At this stage the number of people as well as their positions is not completely clear, but hopefully there is time available to consider at least ten persons. I have contacts to German executives at Daimler Buses in Germany, where I wrote my diploma and also to an event management company and a consultancy company in Germany where I worked for in the last two years. In addition, I am confident to get access to British firms and their executives in the IBIS destination and line number display sector by refreshing former business links. I intend to use structured interviews as far as possible, because the aim of this approach is to ensure that each person interviewed is presented with exactly the same questions in the same order. This ensures that answers can be reliably aggregated and comparisons can be made between sample subgroups or different survey periods. The choice of answers to the questions for this kind of research method is often fixed in advance, although open-ended questions can also be included within a structured interview as well. Particularly, the questioning as well as the analysis and the evaluation of the given answers is manageable in this short time. And because a structured interview is a quantitative research, statistical trends can be pointed out and compared with the theoretical approaches.
2. Chapter 2 Literature Review
2.1. Introduction
This review aims to outline background research that the author has composed in order to explore if companies can agree with third party recruitment and their organisation’s frame of corporate social responsibility. The author will discuss the theory of corporate social responsibility, executive search and the impact on processes of external consultancies and then proceed to link and synthesize the ideas. Finally the relationship between corporate social responsibility and third party recruitment will be explored.
2.2. Business Ethics
The majority of definitions currently in use tend to characterize ethics as being concerned with moral judgment and standards of conduct (Buckley et al., 2001). In order to better manage moral and ethical dilemmas, many professions have developed behavior and knowledge standards for members. Such guidelines include codes of ethics, licensing requirements, specific missions, specialised intellectual knowledge including literature and research, and organizations that develop and maintain adjudication processes for members who do not follow the expected standards (Kaplan, 2006). The executive recruiting profession is no exception to this rule, and many professional organizations provide such ethical standards for their members. Therefore, the ethical conduct of executive recruiters could be said to relate to how well they conform to the code of conduct of any professional organization in which they maintain membership. One major organization that supports ethical conduct on the part of executive recruiters around the world is the Association of Executive Search Consultants. According to its corporate Web site, “The Association of Executive Search Consultants (AESC), as a worldwide association of retained executive search consulting firms, strives to enhance the professionalism of its members. Accordingly, AESC has developed the following Professional Practice Guidelines to assist AESC member firms in their business relationships with clients, candidates and the public around the world” (Professional Practice Guidelines, 2008 p. 2).
The AESC’s current ethical standards are provided in Table __ below.
Table __.
Association of Executive Search Consultants Professional Practice Guidelines.
Area of Practice
Ethical Guidelines
Relationship between AESC Members and Their Clients
AESC members are partners with their clients in a consultative process aimed at selecting organizational leaders. Success in these partnerships depends upon a strong mutual commitment to the task at hand as well as mutual trust, candor and responsiveness by each party as the search progresses. The AESC recommends that, in order to avoid misunderstandings later, agreements between clients and member firms concerning conduct of the search and other significant matters should be put into writing.
Accepting Client Assignments
Outstanding client service begins with a full understanding of the client organization, its business needs and the position to be filled. An AESC member should:
Accept only those assignments that a member is qualified to undertake on the basis of the member’s knowledge of the client’s needs and the member’s ability to perform the specific assignment.
Disclose promptly conflicts of interest known to the AESC member and accept assignments only if all affected parties have expressly agreed to waive any conflict.
Develop an understanding with the client that, among other things, makes clear the organizational entity that is defined as the client organization, the fees and expenses to be charged, and any ongoing assurances or guarantees relating to fulfillment of the assignment.
Agree with the client concerning any “off-limits” restrictions or other related policies that govern when and how the member may recruit from the defined client organization in the future.
Agree with the client on what information about the position in question will be made available to candidates and sources during the search, when this information will be released, and in what form.
Advise the client when advertising is required by law or is a recommended strategy for the particular search assignment.
Performing Client Assignments
Members should serve their clients with integrity and objectivity, making every effort to conduct search consulting activities on the basis of impartial consideration of relevant facts. Specifically, an AESC member should:
Conduct a focused search for qualified candidates consistent with a search strategy agreed upon with the client.
Develop with full client involvement and approval a comprehensive job description for each search engagement and make this available to candidates before they are presented for interview with the client.
Thoroughly evaluate potential candidates before presenting them for an interview with the client. Such evaluation normally includes in-depth interviews in person or by video-conferencing, appropriate preliminary inquiries into references and background, and a careful assessment of the candidates’ strengths and weaknesses against the specification for the proposed position. Clients should be advised when circumstances require a modified approach.
Agree with the client as to what reference and background checks need to be conducted on finalist candidates, what elements these checks should cover, how extensive they should be and who will perform them.
Present information about the candidate to the client honestly and factually and include any reservations concerning the candidate that are pertinent to the position.
Advise the client promptly and offer alternative courses of action if it becomes apparent that no qualified candidates can be presented, or that the length of the search will differ considerably from that originally specified.
Withdraw from the assignment if a member determines that a client has characterized its organization falsely or misled candidates and is unwilling to rectify the situation.
Refrain from the presentation of resumes in the absence of an existing client relationship.
Preserving the Confidentiality of Client Information
AESC members should use their best efforts to protect confidential information concerning their clients. Specifically, a member should:
Use confidential information received from clients only for purposes of conducting the assignment.
Disclose such confidential information only to those individuals within the firm or to those appropriately qualified/interested candidates who have a need to know the information.
Not use such confidential information for personal gain, nor provide inside information to any other parties for their personal gain.
Avoiding Conflicts of Interest
AESC members have an ethical obligation to avoid conflicts of interest with their clients. For example, a member should:
Refuse or withdraw from an assignment upon learning of conditions that impair the member’s ability to perform services properly, including actual or potential conflicts of interest unless all affected parties expressly agree to waive the conflict.
Provide to clients the member’s undivided loyalty as an advocate and professional advisor in the process of negotiating with finalist candidates. Only in exceptional circumstances, and only with agreement in advance of all affected parties, may candidates be presented to more than one client simultaneously.
Inform clients of business or personal relationships with candidates that might affect or appear to affect the member’s objectivity in conducting the assignment.
Not accept payment for assisting an individual in securing employment.
Relationships between AESC Members and Candidates
Although a member’s primary relationship is with the client, member firms also seek to establish professional relationships with candidates. These relationships should be characterized by honesty, objectivity, accuracy and respect for confidentiality. In building such relationships, a member should:
Explain the relationships that exist between the parties involved in a retainer-based search consulting engagement, and in particular the rights and obligations of the candidate in the process.
Provide candidates with relevant and accurate information about the client organization and the position.
Encourage candidates to provide accurate information about their qualifications. Upon learning that a candidate has misled the client or member regarding his or her qualifications, reject the candidate unless the client, candidate and member agree that the candidacy should continue following disclosure of the facts.
Present to clients accurate and relevant information about candidates, and otherwise maintain the confidentiality of information provided by prospective and actual candidates.
Only provide an individual’s confidential resume or other confidential data with the individual’s prior consent, and in the context of an existing client relationship.
Advise prospects and candidates of the status and disposition of their candidacies in a timely fashion.
Explain that only in exceptional circumstances may an individual be presented on more than one search simultaneously, and then only if all involved parties agree.
Advise candidates that, so long as they remain employed by the client organization, the member firm may not approach them as a candidate for a future search without the express permission of the client.
Relationships between AESC Members and their Contractors
AESC members sometimes rely on contractors and subcontractors to assist in the search process. Services may be subcontracted but responsibility for them cannot be. A member should:
Inform its contractors and subcontractors in writing that they should adhere to the AESC’s Code of Ethics and Professional Practice Guidelines.
Avoid contractors and subcontractors whose practices are inconsistent with the standards of professionalism expected of AESC members.
Conduct relations with the media so as to reflect favorably upon clients, the AESC, and the executive search consulting profession.
Relationships Between AESC Members and the Public
AESC members should recognize the importance of public trust and confidence in their profession and seek to serve their clients in a manner consistent with the public interest, taking into account differing legal contexts in different countries. Therefore, a member should:
Observe the principles of equal opportunity in employment and avoid unlawful discrimination against qualified candidates.
Promote and advertise member firm services in a professional and accurate manner.
Source: Association of Executive Search Consultants (2008) available at http://www.aesc.org/article/guidelines/.
It is clear that the ethical responsibilities of executive recruiters extend far beyond the relationship between the firm and the client, but rather extend to the larger society in which they compete as well. Moreover, these standards are always in a state of flux and may be amended from time to time as the profession evolves and adapts to developments in business practice, technology and the law (Professional Practice Guidelines). While there are some solid guidelines in place for many executive recruiting associations, the guidance available for corporate social responsible behaviors is more nebulous, but represents an equally important component of ethical behavior today and these issues are discussed further below.
2.2.1. Corporate Social Responsibility
Unlike the professional practice standards reviewed above, there is not a universally accepted definition of corporate social responsibility, though many have attempted to define it. It According to Karake-Shalhoub (1999), “It is difficult to explain the social responsibility of any particular business because there is no clear-cut definition of this function” (p. 4). Despite these constraints, the Commission of the European Union (2002) defines corporate social responsibility as “a concept whereby companies integrate social and environmental concerns in their business operations and in their interacting with their shareholders on a voluntary business” (p. 37). Similarly, Robbins and Decenzo (2001, cited in Kapadis and Katsioloudes, 2001) define it as the “obligation of a firm, beyond the requirement by law or economic s to pursue long-term goals that are good for society.” Finally, Frederick, Post, and Davis (1992) provide a fairly comprehensive definition of corporate social responsibility as being: “Corporate social responsibility means that a corporation should be held accountable for any of its actions that affect people, their communities, and their environment. It implies that negative business impacts on people and society should be acknowledged and corrected if at all possible” (p. 30).
There are a number of angles to corporate social responsibility. Some believe that the sole purpose of a firm is to maximise shareholder value such as Friedman (1970), and they are defined as libertarians. Others completely oppose this idea such as Freeman (1984). They believe that companies act exclusively in the interest of the greater good and are defined as communitarians. There is a middle ground that some authors such as Brenkert (1992 cited in Capaldi) advocate. Capaldi (2005) recognises even with a more balanced stance authors tend to pole toward one extreme. Friedman (1970) was responsible for the doctrine that a company’s social responsibility was to maximise profits. He claims that pursuing profits is beneficial to society. The more profits the company makes the more tax the company will pay. This can then be spent by the government on social facilities such as hospitals and schools. Friedman (1970) emphasises the fact that people can do good, but only at their own expense. Wulfson (2001) agrees with this idea and states that directors have no right to give away shareholder money. Friedman (1970) disputes assertions that businesses have responsibilities and believes that only people can have responsibilities. This stance is supported by the idea of agency theory. Eisenhardt (1989) indentifies that agency theory describes the organisation of a relationship where one party (principal) instructs another (agent) what to do. Friedman (1970) claims that by forcing CSR policies upon shareholders the company is taking away their freedom to choose and is being irresponsible. Stenburg (2004) takes a similar stance and claims that a manger’s fiduciary duty is to maximise shareholder wealth.
Dodd (1932) completely disagrees with this opinion and holds the belief that companies operate for the benefit of social good, and not for the bernefit of the shareholders. Greenfield (2004) disagrees and agrues that a company has two obligations: to make money and to obey the law, neither of which involve social good. Tuzzolino and Armandi (1981) look at CSR in relation to Maslow’s hierarchy of needs. They suggest that once a firm has performed its basic need to make a profit then it m ay begin to look at other needs such as having CSR policies.
CSR as defined by Branco and Rodrigues (2006) is the “ethical and moral issues concerning corporate decision making and behaviour.” They state that there has been much controversy about responsibilities of a firm with regard to their social impacts. It is unclear whether they should undertake activities that mitigate their perceived negative impacts by primary stakeholders or whether it is waste of resources. Holme and Watts (2000) relate CSR to a “firm’s commitment to contribute to sustainable economic development, working with employees, their families, local communities and society at large to improve the general quality of life.” Dyllick and Hockerts (2002) further support the idea of sustainable development and CSR being linked. They claim that sustainable development is meeting present stakeholder needs without compromising the needs of future stakeholders. Branco and Rodrigues (2006) have split the idea of sustainability into three tiers; economic sustainability, environmental sustainability and social sustainability. Branco and Rodrigues (2006) further suggest that CSR covers a number of issues including environmental protection and health safety. Modern CSR polices are voluntary policies followed by a firm that give a perceived benefit to primary stakeholders such as employees and the community.
CSR policies can be viewed as having two different approaches: the normative approach and the business approach. The normative approach is the idea that the business has morals and thus acts in a responsible manner. The business approach suggests that the firm has self-interest with regaqrd to its policies. It will behave in a responsible way as it will ultimately have long-term success from it. Smith (2003) believes that a firm will have a mixture of the two approaches when determining its policies and related activities. The policies can also vary according to the beliefs and values of the managers of the business. This can introduce bias, meaning that the socially responsible activities undertaken by the business may be of little economic benefit to the company, and my in fact be detrimental. Branco and Rodrigues (2005) mention the costs incurred by a business in order to present a cocially responsible image. The idea behind incurring coasts is hopefully to gain long-term benefits that will help the long-term success of the business.
Caroll (1991) has perhaps the most comprehensive definition of corporate social responsibility. He suggests there are four categories of social responsibility a company must adhere to: economic, legal, ethical and discretionary. Economic responsibility refers to the fact that firms must provide goods or services that are demanded whilst being profitable. The firm has a legal responsibility to operate within the confines of the law. Ethical and discretionary responsibilities are a more general code of conduct the company follows when functioning. All companies are expected to perform these responsibilities concurrently. Sethi (1975) holds a similar opinion.
Atkins (2006) argues that using company assets for purposes other than shareholder wealth maximisation is irresponsible. The directors are acting as agents for the shareholders, and should not misappropriate their funds. If certain shareholders choose to invest their own money in charitable companies then it is their decision to do so, and this is responsible. This decision is not for the directors to make. If they believe in environmental causes they can modify their behaviour and buy economic cars or choose to recycle, but again it is not up to the company to use funds for this purpose, this would be irresponsible. Atkins (2006) offers a solution for having a socially responsible company that also maximises shareholders wealth. She suggests a litmus test. As an example she offers Apple selling an iPod for $99 and another identical for $125, with all extra profits going to socially responsible causes. She argues that the market could then decide whether to support such funds.
2.2.2. Frameworks of CSR
There are many examples of social responsibility frameworks available in literature that aim to “alert companies to responsible business practices that will simultaneously do well financially and do good socially” (Waddock, 2000, p.75). However there is a new trend of companies being forced into adopting CSR activities that are detrimental to the financial success of the company. This could be form stakeholders such as NGOs concerned with the impact the company has on the environment. As a result of undertaking activities above and beyond their legal requirements the shareholders may feel their money is being misappropriated.
Miles and Covin (2000) and Karna et al. (2003) suggest that firms may respond to CSR is one of two way. The first will be simply to comply with regulation. The second response is to prioritise CSR as a way of gaining a competitive advantage. Miles and Covin (2001) further quantified that this competitive advantage could be due to increased efficiency or by increasing the value of the firm’s market offering. Munilla and Miles (2005) claim that firms in a commodity market will focus more on just complying. They suggest “firms that leverage CSR is a strategic manner will have more options in developing strategy and creating competitive advantage” (Munilla and Miles, 2005, p.5).
Van Marrewijk (2003) developed a framework consisting of five “ambition levels.” These levels relate to its social, economic and environmental responsibilities. The five ambition levels are compliance, profit, caring synergistic and holistic. Van Marrewijk (2003) and Carroll (1991) both hold the view that there are no negative consequences to CSR, which contrast the view of Friedman (1974).
Munilla and Miles (2005) suggest that there is a continuum ranging from compliance with CSR to strategic CSR to forces CSR. They define this as when minority activist stakeholder force particular policy, and this always has a negative impact on the firm. This is because “a forces CSR position is a reactive response to social pressure and has no basis for sustainable competitive advantage. In addition, a forced CSR perspective may result in long-term reputational, managerial and strategic conflicts for the firm” (Munilla and Miles, 2005, p.385).
2.3. Recruitment
Any organization, be it business or otherwise, requires people to function (Schein, E.H. (1988) Organisational Psychology, 3rd Edition, Prentice-Hall). In order to this requirement of an organization, recruitment fulfils the job of satisfying that need. Robbins and Coulter (2005) identify recruitment as the process of locating, identifying and attracting capable applicants for available positions. Recruitment is a part of Human Resource Management and no organization can progress without proper Human Resource Practices. Recruitment refers to the process of finding right people for the right job or function. Recruitment polices and practices refer that how that person should be hired and are followed and carried out by the recruiters or the HR managers. Successful, efficient recruitment, benefits organisations in that it increases it chances of gaining and thus increasing the ever important economic theory of the human capital factor. (Mullins, 1999) the human capital theory suggests that education or training raises the productivity of workers by imparting useful knowledge and skills, hence raising workers’ future income by increasing their lifetime earnings (Becker, 1964).
One of the many adverse consequences of poor recruitment is the possibility of a high level of staff turnover. Not only does this lead to increased direct costs, it also has a disruptive effect on the use of managerial time. In addition, a very important intangible cost is the effect of high staff turnover on the morale, motivation and job satisfaction of staff and on the level of organisational performance and customer satisfaction. (Mullins, 1999)
Internal recruitment involves existing employees and volunteers who are given an opportunity to apply for a new job opening.
2.3.1. External recruitment
External recruitment involves staffing outside of the organisation. This search can take place in local, regional or international labour markets, depending on numbers, skills, competencies and experiences required, the potential financial costs involved and the perceived benefits involved to the organisation concerned. (Beardwell, et all, 2004)
2.3.2. Executive search
According to Slew (1997), “Executive recruiters – known as headhunters – are being called upon increasingly to find suitable candidates for the top jobs…. The searches aren’t cheap” (p. 4). On the one hand, executive search firms offer a number of advantages for the company in search of a special individual to fill a key executive role, but on the other hand, there are also a number of explanations offered that prevent companies from using this method including the following:
Recruiters are not ethical/too ‘sleazy.’ Clients see all recruiters as birds of a feather. They are all untrustworthy and, therefore, should be avoided.
Fear of rejection or quick dismissal. Clients anticipate being treated shabbily by recruiters and, therefore, avoid them.
They hurt my chances.’ Some clients think that all recruiters will overcirculate their resumes. According to this line of thought, overcirculation can lead to several problems. First, the candidate loses control of the job search. Second, the candidate’s chances of approaching a company directly are damaged.
My industry/function is different. Clients think that their industry and/or function is distinctive and, therefore, executive recruiters are not likely to be effective (Pickman, 1994, pp. 29-30).
Therefore, the perception and reality of ethical behavior and the executive search firm’s reputation in the industry are profoundly important considerations for both potential clients and the companies for which they are recruited. One executive search firm that is regarded as ethical in its search tactics is Norman Roberts and Associates, a Los Angeles consulting firm. According to Slew, “To find candidates, the company taps its database of 150,000 resumes, researches similar local governments, and advertises in professional journals such as the International City/County Management Association newsletter and Public Sector Job Bulletin” (p. 4). The ethical nature of their executive search tactics was noted as relating to the company’s policy of only recruiting a candidate once: “Once a candidate is hired, the headhunter firms don’t recruit that person for other jobs” (Slew, p. 4). As a Norman Roberts and Associates executive explained, “We don’t recruit anyone away from a client; that person is permanently off limits. That would be… very unethical” (quoted in Slew at p. 4). This executive search firm also goes the “extra mile” in conducting its due diligence in its executive recruiting efforts. According to Slew, Norman Roberts and Associates conducts a thorough vetting of potential executive candidates: “To screen potential executives, the company contacts references, verifies degrees and researches newspapers and journals covering the previous 10 years. The firm also does credit, criminal, motor-vehicle and civil-litigation checks on candidates” (p. 4).
There are some important changes taking place in the industry that represent yet additional opportunities for unethical behaviors on the part of executive recruiters today. For instance, executive recruiters are increasingly using the Internet in response to many of the problems typically associated with traditional recruitment activities. The online approach provides employers with the ability to better manage recruiting activities with corporate human resource departments and to monitor recruiting more effectively (Charles, 2000). These technologies also save time and effort for executive recruiters. According to Zakryscha Hayes, president and human resource specialist for Precise Staffing Services in Chicago, “We’ve incorporated searching on the Internet into our recruiting activities because we’ve found that individuals on the Internet tend to hold advanced degrees and have many years of experience in their field. We’ve placed talented directors, vice presidents and executive-level candidates for our clients through our Internet activity” (quoted in Charles at p. 90).
There are some ethical considerations involved here as well, though, and this author emphasizes that unethical executive recruiters have found ways to exploit these systems. For instance, Charles cautions, “When choosing a resume site, carefully review the posting and removal policies. You’ll also want to double check who can have access to your resume: It’s become common for less ethical recruiters to send robots onto sites to collect ‘inactive’ resume to present to their clients” (p. 90). Likewise, a growing number of companies are now conducting job interviews via video conferences and executive recruiters use them as well (Mogel, 2002). These technologically facilitated recruiting techniques afford yet another opportunity for unethical behaviors on the part of executive recruiters, but the handwriting is on the wall and the trends towards these new recruiting approaches are clear. Therefore, those companies that seek to take advantage of traditional and new recruiting approaches while balancing their corporate social responsibility obligations in the process may be at a disadvantage to those which engage in unethical approaches, and these issues are discussed further below.
2.4. What are the choices facing organizations? What are the consequences?
There are some clear choices available to organizations of all types in their executive recruiting function. First, they can rely completely on their in-house human resources services to accomplish this task, or second, they can outsource it to an executive search firm, aka “headhunters.” Third, they can use a combination of these techniques in varying degrees as the situation demands. The consequences of the choice of approach, though, will likely affect the resulting pool of candidates and the choices available to the recruiting company in important ways. In this regard, Gellerman (1992) emphasizes that, “When executive recruiters are asked to conduct a search, they first create a pool of qualified candidates. The more candidates there are in that initial pool, the better. That’s because the chances that the pool includes some real winners increase as the pool itself expands. However, that’s only true if demanding standards are used to qualify candidates for the pool” (p. 29).
Ethical executive recruiters will accomplish the due diligence needed to ensure they conform to the ethical standards established for their professional organization, as well as making the extra effort to ensure they are not wasting their clients’ time and resources in the process. As this author notes, among ethical executive recruiters, “Top-flight job performance is taken for granted. What the recruiters look for is something that distinguishes an individual from other top performers. So they’ll look for someone who has caught the eye of knowledgeable peers. They’ll ask as many well-informed people as they can speak with to propose individuals who really know their stuff. Then they’ll check those names out with other sources” (Gellerman, p. 29). This extra effort clearly requires a good deal of time and effort, but this is precisely what most companies are looking for in an ethical executive search firm. It is one thing to provide a recruiting company with one or two individuals that meet the position requirements, but it quite another to provide them with a larger pool of candidates that are all equally qualified and have had their qualifications verified. In this regard, Gellerman advises, “What they’re looking for is a consensus. They want candidates who are highly regarded by their fellow professionals. Only after they create a pool of such well-esteemed people do they begin to narrow it down, trying to figure out which will have the most intuitive appeal to the executives of their client company” (p. 29).
Most business executives are busy people (or at least like to think they are), and this is one of the fundamental reasons that is used to justify the expense and risks associated with outsourcing this human resource function to executive search firms today. As this author concludes, “To use a baseball analogy, good executive recruiters are like good batting practice pitchers. The objective is to throw a pitch that the batter can hit. Similarly, the recruiter wants to present the client with a small group of candidates who are all likely to handle the job well. That way, it doesn’t matter which one of them the client intuitively prefers” (Gellerman, p. 29). The provision of executive recruiting services in an ethical fashion, then, requires more than a seat-of-the-pants approach to executive search and must be a top-down goal of all such firms. In this regard, “The fact is, as with many company’s shared values, ethical [behaviors] add value for customers as well as employees” (How to Land a Job in a Tight Economy, 2001 p. 147). Therefore, to the extent that executive search firms are available to conform to their ethical standards while satisfying the needs of their client companies is the extent to which the industry will likely overcome its characterization as unethical “headhunters.”
3. Chapter 3 Methodology
3.1. Introduction
The methodology selected for this research project consisted of a mixed approach that was deemed best suited for achieving the above-stated research goals. This approach is highly congruent with a number of social researchers. For instance, “A methodology should specify methods but only in order to justify their use for defined purposes in specified situations” (Walker, 1985 p.82). Jankowicz (1995) identifies methodology as, “The analysis of the rationale for the particular methods or methods used in a given study.” This chapter contains the chosen research methods and techniques that will be presented and analyzed. The focus will be on comparing the advantages and disadvantages of the used methods and techniques to justify the reasons for adoption and rejection of particular methods.
3.2. Primary Research
Fisher (2004) highlights the importance of time management when researching the project, allowing time for delays and amendments. Within this project, time was supervises well, allowing time for pilot “tests” and semi-structured interviews before constructing the final draft of the questionnaire used in final interviews. According to Dennis and Harris (2002), “Primary data are information that is being collected for the first time in order to address a specific research problem. This means that it is likely to be directly relevant to the research, unlike secondary data, which may be out of date or collected for a totally different purpose. Ideally, an effective research project should incorporate both primary and secondary data” (p. 39). Likewise, Chisnall (1997) defined primary data as date that is collected for the first time by either one or a blend of:
a) Observation b) Experimentation c) Questionnaires
During the examination, the primary research techniques were adopted and as conclusion for fitting methodology semi-structured interviews were chosen.
3.2.1. Semi-structured interviews
The format of the interviews should remain constant throughout the research project (Chrisnall, 1997 p.40). The use of a tape recorder, the room lay out and the position of the researcher was consistent. The only changing factors were the people being interviewed, and at times the responsiveness of the interviewees. The only time the researcher spoke was to prompt the interviewees when they had a conversation drought to clarify points that were vague, or to involve the topics that the author and previously predicted, purely as a course of elimination.
The author carried out “semi-structured” interviews, which Saunders (2007) defines as covering a list of themes and questions to be covered, although these may vary between interviews without restricting to any specific order. It allows all relevant themes to be covered without the strictness of structured interviewing. As highlighted by Cooper and Schindler (2006), the issue of focus and credibility is again vital, so the themes and questions will cover specifically the information explored in the literature review and directly reflect the questions in the staff questionnaire, allowing comparative analysis. The interview will be taken “face-to-face,” whilst being tape recorded, together with note taking. Reducing any risk of information being misheard or lost. (Fisher, 2004)
The benefits of tape recording are the ease in which the author can analyse the findings, whilst producing transcripts, analysing only the statements recorded. Limitation to this method could result in the interviewee feeling intimidated and reserve in their answered, especially at the risk of revealing information that may be deemed sensitive. It is therefore important for the author to pay considerable attention to these issues. This again is a benefit of semi-structured interviews, where the author can pose additional questions if necessary.
As detailed by Fisher (2004) the device used can also present limitations, such as technical difficulties. It was therefore important for the author to prepare the device, charging the batteries and carrying out a practise recording prior to each interview.
Two interviews were taken by the author, directed at one senior manager of a multinational company who is involved in the recruitment process for his commodity team. The other one is a CEO of a German midsized company in which he recruits the staff with the help of a recruiting consultancy. The benefit of interviewing them could provide different viewpoints based on their level in the organisation and their responsibility in the process itself. The author provided an explanation of the research prior to the interview to ensure understanding. Each participant was not able to see the themes of discussion beforehand, reducing bias and engaging natural response.
3.3. Inductive and deductive approach
Williams and May (1996 cited in Baker 2003) defines deductive research as “research that is purely deductive begins with a theoretical system, operationalises the concepts o f that system and then sets out to gather empirical data to test out that system.” Trochim (2002) supports this statement of a “top down” approach- Williams and May (1996 cited in Baker 2003) claims that if conducting inductive research the first step is to collect the data. The date is then observed and a general conclusion is then formed Trochim (2002) agrees with this idea and states “in inductive reasoning, we begin with specific observations and measures, begin to detect pattern and regularities, formulate some tentative hypotheses that we can explore, and finally end up developing some general conclusions or theories.” Furthermore, the author kept a neutral attitude when analysing data collected, and tried to keep the research’s results objective.
When choosing an inductive approach, firstly, data is collected and secondly, a theory is formulated after analysing the data (Saunders, et al., 2003). The author chose a deductive approach in the dissertation. First, the author critically reviewed the existing theories about organisations and their behaviour as well as theories about CSR frameworks, and some related theories about the headhunting industry and executive search consultancies and their methods of recruiting and poaching. The second step is developing several hypotheses and questions based on these theories. In order to carry out the research, the author contacted managers to get detailed information.
3.4. Conduct of research
The choice of methodology greatly depends on the research purpose and research questions (Saunders, Lewis & Thornhill, 2003). Choosing a proper methodology is important to achieve the aim of the dissertation, to get valid and reliable results. Realism is used as our research philosophy. Mainly, it covers the study of human subjects (Saunders et al., 2003). It means that an external and objective social world exists, and there are greater social forces affecting people’s thoughts and behaviours. Like positivism, the researcher is independent and neither affects nor is affected by the subject of the research when adopting the realism philosophy. The main difference between them is that the realism principle pays more attention to the complex social context (Saunders et al.,2003). White (2002) identified that quantitative and qualitative research are the two main research methods used by academics.
Denscombe (1998, p.212) suggests that the “Researcher’s self is an integral part of qualitative research, and thus the neutrality of the research is at risk if the researcher introduces personal bias.” Denscombe (1998, p.213) proposes that “reliability and freedom from bias can be enhanced if an explicit account of how the research was undertaken and the reasoning behind any key decision is given.” Thus, the methodology forms an important part of qualitative research, as it enhances the robustness and the validity of the findings.
Saunders et al. (2003) stated that the analysis of qualitative date involves a demanding process and should not be seen as an easy option. Quantitative data can be defined as “scientific investigations in which numbers are uses to measure variables such as characteristics, concepts, or things” (Cinahl Subject Headings, 1990). The quantitative method is associated with a positivist approach (White 2000) and is thought to be more scientific and objective as it uses numerical data. Saunders et al. (2000) define a positivist approach as “incorporating scientific principles which involve the development of a theory that is subject to a rigorous test” Weber (2003) asserts that a positivist believes that the world is separate from the person that observes it. He further clarifies that positivists aim to collect data that will represent what actually happens in reality. – Qualitative data however is the opposite and is subjective and descriptive (White 2000). It is research that acquires its data from methods such as observation and interviews (Seale, 1999). This is normally associated with an interpreters’ approach. Interpreters do not believe that there is a separation of reality and the person observing it. Qualitative research can be thought of as exploratory while quantitative research can be thought of as conclusive (Weber, 2003). However, qualitative data “are characterised by their richness and fullness based on opportunity to explore a subject in as real a manner as possible” (Robson, 2002 cited by Saunders et al., 2003, p. 378).
Therefore, the conduct of the research proceeded in a step-wise fashion as described by Gratton and Jones (2003) in Figure __ below.
Figure ____. Conduct of the research.
Source: Gratton and Jones, p. 32.
3.5. Questionnaire design
Based on the empirical findings of the semi-structured interviews and observations described above, a series of Likert-scaled survey questions were developed requiring a response from the human resources respondents ranging from “strongly agree” to “strongly disagree” with a “no opinion/not applicable” option offered. A proforma copy of the questionnaire instrument is provided at Appendix ____. Section one of the questionnaire collects some limited demographic data from the respondents, section two consists of the Likert-scaled questions and section three provides an open-ended commentary section. The statistical data that resulted from the administration of the questionnaire were analyzed using SPSS Version 11.0 (Student Version) and the results presented in tabular, graphic and narrative form in Chapter 4, findings and analysis, immediately following. All responses to section three, open-ended comments, are also presented verbatim in chapter 4.
3.6. Ethical consideration
When conducting the research the author has applied ethical working, ethical issues are more apparent when collecting primary research, especially with regards to vulnerable adults and children. Only people that appeared to be over the age of 18 were approached to complete the interview, and if there was any doubt there were asked to verify their age. Respondents were told about the purpose and future use of the questionnaire and asked whether they would participate. They were informed that completion was entirely voluntary and they could withdraw at any time. There were also told verbally that they could refuse to answer questions if they felt in infringed their privacy. The identities of the participants are completely confidential. The author has used the Harvard referencing system throughout to avoid plagiarism. The author has assumed that the date uses was reliable as the sources used were reliable.
4. Chapter 4 Findings and Analysis
4.1. Introduction
This chapter presents the statistical analysis of the survey of executive recruiters as described more fully in the methodology chapter above.
4.2. Findings of the primary research
Semi-Structured Interviews:
Senior manager, multinational company.
Questions:
May I quote you or your company or do you prefer total anonymity?
Do you use recruitment consultancies like headhunters regularly or on specific occasions only?
Which departments in your firm frequently require executives? Do you ever ask headhunters to recruit a whole team?
What is the salary range of executives recruited?
How important is ethical behaviour for you personally and for you in your job?
Are candidates selected generally appropriate given their level of salary and the expenses incurred?
Do you use international or local search firms, or does this depend on your particular requirements at the time? What are the advantages of using a larger over a small firm?
Do you have any comments on the search firm’s performance?
How did you find out about these firms in the first place?
What are the advantages of using search consultancies over employing your own recruiting facility? Do you find them more expensive?
Do you employ any defence mechanisms to protect your firm against poaching by other firms via headhunters and co?
Have there been any breaches of confidentiality of illegal use of information by search firms you have employed in the past?
What is more important filling the vacant position with the right people, or act strictly to your CSR framework?
Have any headhunters joined your firm to fill in a position they were initially asked to search for?
CEO, midsized German company.
Questions:
May I quote you or your company or do you prefer total anonymity?
Do you use recruitment consultancies like headhunters regularly or on specific occasions only?
Which departments in your firm frequently require executives? Do you ever ask headhunters to recruit a whole team?
What is the salary range of executives recruited?
How important is ethical behaviour for you personally and for you in your job?
Are candidates selected generally appropriate given their level of salary and the expenses incurred?
Do you use international or local search firms, or does this depend on your particular requirements at the time? What are the advantages of using a larger over a small firm?
Do you have any comments on the search firm’s performance?
How did you find out about these firms in the first place?
What are the advantages of using search consultancies over employing your own recruiting facility? Do you find them more expensive?
Do you employ any defence mechanisms to protect your firm against poaching by other firms via headhunters and co?
Have there been any breaches of confidentiality of illegal use of information by search firms you have employed in the past?
What is more important filling the vacant position with the right people, or act strictly to your CSR framework?
Have any headhunters joined your firm to fill in a position they were initially asked to search for?
Human Resources Questionnaire:
How long in current position?
____ years
Male
Female
Section Two
Our company uses recruitment consultancies like headhunters regularly.
Our company uses recruitment consultancies like headhunters only on specific occasions.
Ethical behaviour is very important for me personally and for effective functioning in my job.
Candidates selected are generally appropriate given their level of salary and the expenses incurred.
We only use executive recruiting firms that are members of a professional organization guided by professional standards of ethical conduct.
Section Three: Open-Ended Questions and Comments.
Which departments in your firm frequently require executives?
Do you ever ask headhunters to recruit a whole team?
What is the salary range of executives recruited?
Do you use international or local search firms, or does this depend on your particular requirements at the time?
Are there any advantages of using a larger over a small firm?
Do you have any comments on the search firm’s performance?
How did you find out about these firms in the first place?
What are the advantages of using search consultancies over employing your own recruiting facility? Do you find them more expensive?
Do you employ any defence mechanisms to protect your firm against poaching by other firms via headhunters?
Have there been any breaches of confidentiality of illegal use of information by search firms you have employed in the past?
What is more important:
filling the vacant position with the right people, or act strictly to your corporate social responsibility (CSR) framework?
Filling the vacant position:
Acting according to CSR:
Have any headhunters ever joined your firm to fill in a position they were initially asked to search for?
5. Chapter 5 Conclusion
5.1. Introduction
5.2. Summary
5.3. Limitations
5.4. Further research suggestions
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Appendix
Human Resources Questionnaire
Section One.
How long in current position?
____ years
Male
Female
Section Two
Our company uses recruitment consultancies like headhunters regularly.
Our company uses recruitment consultancies like headhunters only on specific occasions.
Ethical behaviour is very important for me personally and for effective functioning in my job.
Candidates selected are generally appropriate given their level of salary and the expenses incurred.
We only use executive recruiting firms that are members of a professional organization guided by professional standards of ethical conduct.
Section Three: Open-Ended Questions and Comments.
Which departments in your firm frequently require executives?
Do you ever ask headhunters to recruit a whole team?
What is the salary range of executives recruited?
Do you use international or local search firms, or does this depend on your particular requirements at the time?
Are there any advantages of using a larger over a small firm?
Do you have any comments on the search firm’s performance?
How did you find out about these firms in the first place?
What are the advantages of using search consultancies over employing your own recruiting facility? Do you find them more expensive?
Do you employ any defence mechanisms to protect your firm against poaching by other firms via headhunters and co?
Have there been any breaches of confidentiality of illegal use of information by search firms you have employed in the past?
What is more important:
filling the vacant position with the right people, or act strictly to your corporate social responsibility (CSR) framework?
Filling the vacant position:
Acting according to CSR:
Have any headhunters ever joined your firm to fill in a position they were initially asked to search for
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