Exec-search industry thriving in Philippines

By: Catherine Pillas

Business Mirror

December 22, 2014


The Philippine executive-search industry is continuing its push for enforcement of standards within the industry, and the crusade to curb malpractices, to sustain growth, according to association executives.

The industry, which deals with providing client businesses with corporate and management-level personnel, has been experiencing growth notwithstanding the popularity of online services such as LinkedIn, Jobstreet and JobsDB.

LinkedIn, in particular, aside from being used for networking purposes, has also been a source of recruitment, but the effect of the online tool is insubstantial to the industry.

A larger problem for the executive-search industry, which has been growing between 10 percent and 15 percent in the last five years, is the proliferation of unethical corporate search firms, said Jun Gil, president of the Philippine Association of Executive Search Professionals Inc. (PAESPI), in an interview.

Gil said the association has long been combating the growing number of wayward players in the executive-search industry, which not only dampens the image of the legitimate players but discourages top corporations from using their services.

“Our industry is bound to grow even better in 2015, provided we eliminate the fly-by-night operations and expose the malpractices of these search firms that is taking business away from us. Some have already made clients cynical of the service we provide and they are putting a dent on the industry,” Gil said.

PAESPI itself is only composed of six members as these were the only ones willing to adhere to the strict code of ethics the association advocates in order to qualify for inclusion, Gil said.

The code of ethics, said Ma. Carmen T. Guevara, vice president of PAESPI, upholds the principles of legitimate executive-search firms that do not violate the principles of privacy and confidentiality, which the industry is hinged on.

Violations often committed by delinquent firms include search companies peddling resumes from one company to another, looking for top-level personnel without the permission of the candidate, which Gil said is a violation of the data-privacy law.

The practice puts the candidate at risk of losing his current job as his employer may get wind from the other companies that the employee is on the lookout for other opportunities.

Another violation cited by the PAESPI president is the practice of recycling candidates – placing successful job seekers with their client-businesses and within months, knowing that the particular candidate is sought after, will recommend him to take another job with better benefits elsewhere.

“At this point, the firm has already received the fee 10 months down the road. The firm pirates the employee to another company. It’s the quick-buck mentality. It also doesn’t reflect well for the candidate to keep switching jobs,” Gil said.

Third, yet another malpractice within the industry, said Guevara, is the inside pirating of some head-hunting agencies.

“I’m the client and nagpapahanap ako ng candidate through the executive-search firm. Because of some privileged information that has been exchanged between the client and the search firm, the search company ngayon, pinipirata “yung mga tao within the client’s company itself, It’s like insider trading,” Guevara said.

Last a malpractice rampant among delinquent search firms is playing off competing companies – accepting one client company to look for candidates but also pitching to its direct competitor. This strategy allows for the search firm to be privy to the movements within both companies and play off the benefits to the existing employees of either firm.

Gil said that with most companies declining membership to the association based on the code of ethics, their membership count may not grow in the short term, but this is the price to pay to keep the industry’s image pristine.

“We don’t want the industry to be tainted and fall to ill repute by these firms who are out there to make a quick buck,” Gil said.

The strategy now for PAESPI centers on education: top officials of the association has been conducting breakfast sessions with human-resource practitioners and executives to spread the word, and harness support.

To date, PAESPI has 51 advocacy partners as corporate firms, all of whom pledged to ensure that they will work with search firms that are compliant to the code of ethics.

“We are talking to more and more companies to be advocacy partners. We want our advocacy to be like the Integrity Initiative. We want to be seen as a seal of good housekeeping,” Gil said.

Executive Search Industry thriving in the Philippines