Do Headhunters have a Code of Ethics? (Part 4)

How to choose your Headhunter or Executive Search Partner:

You are the decision maker on awarding search assignments. How should you go about selecting and engaging the headhunter or executive search firm of your choice?

If you have dealt with several headhunters in the past, you will have the benefit of knowing who among them is the most effective and reliable. If you wish to widen your field of choice, include those with good reputation in the industry. Google will lead you to a few choices.

If your experience with headhunters is limited, you will want to ask around and

decide on whom to invite for exploratory discussions. Anywhere between 3 to 5 potential search partners will give you a good idea of comparative capabilities, track records, quality of their Consultant / Research teams and fees.

Industry problem: Proliferation of headhunters and malpractices

Over the past years, there has been a proliferation of headhunters in the Philippines owing to the low barrier to entry. We estimate, post-pandemic the combined number of search firms, both professional as well as fly-by-night entities still number in the high 50s.

As a result, competition has spawned many forms of malpractices to the detriment of clients and candidates alike. You should be aware of the following examples:

Conflict of interest: working for two competitors who unwittingly share confidential information with the unethical headhunter.
Betrayal of Client’s trust: placing a candidate with Client A and after a few months, enticing that same candidate to move to Client B. The unethical headhunter makes money twice with the same candidate at the expense of Client A.
Breach of confidentiality: Complete disregard of discretion even for sensitive searches. Client’s identity and other confidential information are indiscriminately divulged causing irreparable damage to the confidential search assignment.
Charging fees without any value add: Sending raw resumes without interviews and without the benefit of professional assessments and due diligence. The burden of screening, assessing and due diligence work is passed on to the client who ends up paying the unethical headhunter.
Resume peddling: Offering raw and unfiltered resumes to claim “ownership” of potential (but unknowing candidates). If anyone of the candidates is hired, the headhunter charges undeserved professional fees.
Misrepresentation: Claiming to represent a Client as a reason to generate resumes which are then peddled to unsuspecting clients.

How to protect your Company from malpractices

Whether you are dealing with success-based or retained search firms, you can protect your company from malpractices while helping professionalize the industry. While “speed” and low fees are desirable, these must be balanced against quality, professionalism and ethical practices.

Accreditation process: If you have not already done so, set up an accreditation process to ensure that only legitimate and professional headhunters are qualified to have dealings with your company.
Code of Ethics: Require your headhunters to have a Code of Ethics as a pre-condition to accreditation.
Client list: Require your headhunters to provide you with a complete client list and contact persons for due diligence purposes.
Search process: Require your headhunters to provide you a summary of their search process, including guarantees and off-limits (companies they cannot contact for conflict-of-interest reasons).

In Retained Search Engagements, clients should expect a higher level of professional service when they engage the services of Retained Executive Search firms. As a universal practice, Retained Executive Search firms commit to the following professional practices:

The executive search firm shall provide you a candid assessment of its capabilities to handle the search.
The executive search firm shall tell you who will conduct the search. Many times, a senior consultant makes the pitch but another consultant, unknown to the client, does the search.
The executive search firm shall provide a high-level consultative relationship. This will include knowledge of the industry, potential candidates, comparative assessments and remuneration levels.
The executive search firm shall hold your information in strict confidence. As your business partner, the search consultant must exercise utmost discretion in selectively using company information to help bona fide candidates arrive at an informed decision.
The executive search firm shall demonstrate a clear understanding of the position, the company and the objectives of the search. You should insist on receiving a report summarizing the consultant’s understanding of your specifications.
The executive search firm shall provide you with regular status reports on the progress of the search.
The executive search firm shall present only qualified candidates who are genuinely interested in the career opportunity and who fit the position and the culture of the organization.
The executive search firm shall conduct due diligence on the chosen candidate. This should include former superiors, peers and subordinates.
The executive search firm shall help you negotiate with the chosen candidate, representing both parties with skill, integrity and high degree of professionalism
The executive search firm shall provide you with a clear understanding of its guarantee policy and other unusual situations that may arise during and after the search.
The executive search firm shall provide you with a reasonable level of follow-through after you have hired the candidate. The consultant should stay in contact with the new hire as long as necessary to ensure a smooth transition.
If at any time during the search your consultant does not seem to understand the nature of the assignment, fails to provide ongoing feedback and progress reports, fails to present a range of qualified candidates, express your dissatisfaction immediately to the consultant and the search firm’s top management.

Given the above, it is up to you, the Client, to hold your search firm to the high standard of service that you expect.

To close this information drive, we must now go back to the original question in part 1 which is “Do Headhunters have a Code of Ethics?”.

Yes, but not all firms. We urge all client companies that use the services of Executive Search firms to once again hold your search firms of choice to high professional standards all the time.