Energy sector oil price swings forcing realignment of C-Suite
“Energy executives managing in this uncertain environment must be mindful of the myriad of factors that impact their bottom line”, said Trina Gordon, president & CEO of Boyden World Corporation.
“Beyond pure supply and demand fundamentals and technology enhancements, political and global regulations play a big role in this industry more than in most other sectors, and thus a strategic eye at the top is critical for exploration and production companies, oilfield service providers and other organizations to ensure they navigate the challenges.”
The report covers changes in the global energy sector, talent strategy connected to oil price swings, increased consolidation and merger activity, private equity plays, and the impact on oil and gas dependent markets and renewable and clean energy developments.
“Due to portfolio losses that near-retirees experienced in the recession, many executives signed up for additional assignments and delayed their exit to rebuild their retirement funds”, explains Tom Zay, Global Leader of Boyden’s Energy Sector and Managing Partner, Boyden Houston.
“After five years of economic growth in the oil patch, those individuals along with the group just reaching retirement are electing to hang it up. The ups and downs of the industry have taken their toll on people who are in the latter part of their careers, and they don’t have the will to fight through another negative cycle. Thus, the already growing shortage of executives is likely to become more acute over the next few years.”
The new report from Boyden also identifies the following trends affecting executive hiring in the sector:
• Increasing demand for Chief Financial Officers, Chief Supply Chain Officers and operational executives
• Opportunities to acquire top talent who are more available in a shifting market
• Growing government regulations across the globe
• Effects of industry consolidation in hiring
• Increasing presence of restructuring advisors and consulting companies
• Oil prices affecting project funding in energy dependent markets such as Russia, Iran and Venezuela
“Many industry leaders see the current low oil price environment as an opportunity to realign costs and continue to invest in technology”, said Tim Hamilton, Partner, Boyden Canada. “Major projects have slowed but oil sands are a long-term asset. One of the encouraging signs is that while expensive executives are retiring, younger executives are being hired and others are being offered promotions. In today’s market, there are solid prospects for talented financial and operational executives.”
“As a result of the phenomenal activity, compensation has doubled over the past 10 years, during which time it has been relatively easy to be a CEO of an oil company”, said Birger Svendsen, Managing Partner, Boyden Norway. “But now the conditions are changing dramatically. The focus on efficiency and profits is at a much higher level. CEOs and top management will have to deal with new and worst-case scenarios. Today’s environment is a game changer.”