In discussing the role of Russians in arts and letters in the late 19th century, Friedrich Nieztche wrote: “In Russia, there is an emigration of intelligence.”
A century later, a wholly different Russia saw an influx of intelligence — of the corporate kind, as Western executives went East to join global Russian companies. Then came the 1998 financial crisis, and western expatriates left in droves.
Now, as Russian companies look to expand their horizons, foreign senior executives are in demand once again, according to the Financial Times.
Russian-owned multinationals are hiring foreign executive talent in an attempt to open up to the outside world. That in part means improving corporate governance. The demand for foreign executives also reflects a strategy to present a new face to potential corporate partners outside Russia. That’s particularly true for companies that are planning to eventually tapping the global capital markets.
If that sounds like CFO territory, it is. “If [Russian companies] want credibility in western markets, and to cement their relationships abroad, they are starting to look especially to hire foreign CFOs,” Mark Jarvis, head of corporate finance at Ernst & Young, told the FT.
Oil giant Yukos has an American CFO, Bruce Missamore. He’s one of about 50 foreigners that the company has hired in the past five years, according to FT.
“It’s all part of the globalization of Russia,” Mikhail Fridman, head of the Alfa group, told the newspaper. “We’ve always been open to foreigners. We believe they bring experience and a different culture.” The conglomerate has a number of foreign senior executives.
“It’s definitely a buyers’ market, and London and Wall Street are not much fun at the moment,” Taru Oksman-Ison, director of Principal Search, which has a number of Russian search assignments, told the FT.
Top priority goes to Russian “repats” — that is, Soviet-born and Western-educated executives who stayed in the West. Now, the country’s rapid restructuring and strong growth rates are luring those executives home.
Vimpelcom’s Jo Lunder believes the trend will continue: “It is difficult to find highly qualified people. As Russian companies grow over the next five to 10 years, they will be pragmatic in seeking the best.”
The new hiring trend suggests an evolution in Russian corporate style, with power beginning to be delegated away from the major shareholders. In the past, a handful of owner-managers usually exercised tight control over the company.
Apparently, those managers have gotten sick of doing all the work. “A lot of these Russian owners are young and bored, and don’t want to work even eight hours a day, let alone 16,” Steven Jennings, head of Moscow bank Renaissance Capital, told the FT. “If they can bring in professionals willing to kill themselves working on their behalf, they are delighted.”