Recruiting C-Level Executives: A New Strategy Beyond Compensation

Key Takeaways

• The unstable economic outlook for 2025-2026 is forcing companies to change how they hire leaders, shifting focus from operational skills to the ability to lead transformation and build resilience.
• The war for top talent is no longer about who pays the most. It’s about who offers a more compelling package: real authority, a clear vision, and the freedom to get things done.
• Companies are paying a premium for leaders who can drive change, which is creating a clear split in the executive compensation market.
• A 43% pay gap between multinationals and local firms for executive roles highlights this focus on finding transformational leaders.
• Keeping senior leaders is becoming harder than hiring them, as modern executives now prioritize non-financial factors like a stable, positive work environment.

The 2025-2026 period is expected to be globally unstable, marked by geopolitical tensions, inflation, and recession risks. Even though Vietnam is a bright spot with over 8% GDP growth forecasted in 2025, local businesses can’t escape this volatility.

The Talentnet-Mercer Total Remuneration Survey, along with macro analysis, shows a clear shift in executive recruitment strategy: the focus is moving from just growth to prioritizing flexibility, resilience, and the ability to lead change.

1. A growing competition for high-quality leadership candidates

Shifting FDI flows and new investment in high-tech and value-added manufacturing are changing the criteria for executive recruitment. The labor market today shows the war for high-quality talent is more intense than ever.

The most sought-after leadership positions are:

• Sales, Marketing & Product (at Professional and Management levels) – reflecting the need to expand markets and enhance competitiveness.
• IT & Telecom (at Professional level) – meeting the demands of digital transformation and technology.
• Engineering & Science (at Professional level) – supporting the enhancement of production capacity and innovation.

This shows a clear demand for leaders with digital skills and tech-savviness. In fact, roles like Data Analytics & Business Intelligence and Real Estate Management currently command the highest salaries at the Management level.

Businesses are no longer just looking for operational skills; they demand leaders with core competencies:

• Strategic skills and digital transformation literacy – the ability to lead innovation, not just manage operations.
• Global integration capability – an understanding of global trends like ESG and changing trade policies.

2. Stricter hiring requirements in an era of tight spending

Cost pressures and the need to optimize are forcing businesses to raise their standards when hiring C-level executives.

Data from the 2025 Talentnet-Mercer Salary Report shows that while 35% of companies plan to increase headcount in 2025, their selection criteria have become much stricter. Companies don’t just need a “good” leader; they need one with experience navigating crises and managing risk in a volatile economy. This is especially critical in industries like Chemicals, Sourcing, and Life Sciences, which are hiring the most leaders right now but are also most sensitive to economic shifts.

Recruiting C-level executives who can guide the organization through unstable times is now critical for survival and growth. Top companies are now looking for leaders who not only have a strong track record in growth periods but also have proven experience in navigating downturns.

3. The challenge of retaining and meeting executive expectations

The war for compensation doesn’t stop at the executive recruiting process; retaining that talent is proving to be even harder.

A significant compensation gap exists:

• The pay difference between multinational and local firms at the executive level has created a substantial gap—43% in base salary and 39% in total income.
• This figure doesn’t just reflect financial muscle; it also shows a difference in strategic vision and corporate culture.

This forces local companies to be more creative in their compensation models, relying not just on salary but on long-term commitments such as:

• Equity programs and long-term incentive plans.
• Bonuses tied to projects and strategic milestones.
• Customized professional development programs.
• Opportunities to shape corporate strategy.

4. Signs of a leadership restructure

As the economy shows signs of recovery, businesses aren’t just hiring again; they are conducting a “leadership reset.” This trend isn’t just about numbers; it’s about the quality and strategic fit of those leaders.

Workforce data shows a notable trend toward younger leaders: At the Management level, Gen Y1 accounts for 55%, with a strong influx of Gen Y2 (18.3%).

Businesses now need a strategy to build flexible organizations with a younger, more innovative generation of leaders. Companies are increasingly cutting underperforming middle-management roles that don’t add value, while adding outstanding leaders who can drive innovation.

Download the full remuneration report for detailed comparative data on C-level salaries by industry and company size—helping you position your compensation policies competitively and build an effective talent acquisition strategy.

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Building a competitive advantage in the new landscape

The most successful companies aren’t the ones that pay the most; they are the ones that create a truly attractive work environment.

1. Innovate your approach to talent

Instead of using traditional channels, leading businesses are investing in their employer brand and partnering with professional executive search firms. This change in their executive recruitment strategy helps them access passive leadership candidates—those who aren’t actively looking but will listen to a great offer.

2. Offer real authority, not just a title

A talented leader will only stay if they are trusted, empowered, and given a real chance to shape the company’s future. Successful companies are giving their leaders the space to experiment, innovate, and execute their ideas.

3. Build a culture of transparency and connection

Building trust in the workplace by being open and transparent with your leadership team about strategic challenges is the best way to build alignment and confidence.

4. Develop a comprehensive rewards strategy

Leading businesses are using a rewards strategy that combines both financial and non-financial elements.

Financial Elements:

• Competitive base salary benchmarked by industry.
• A variable bonus program, averaging 16.7% projected for 2025.
• Profit-sharing and performance-based bonus programs.
• Long-term incentive mechanisms tied to company strategy.

Non-Financial Elements:

• Investment in a positive and sustainable corporate culture.
• Clear and specific career development opportunities.
• A flexible work environment that suits individual needs.
• Autonomy in decision-making and shaping strategy.

These are the key factors that help a company attract and retain outstanding leaders.

Especially when many businesses have salary freezes, these non-financial elements become more important than ever.

In a volatile world, competitive advantage no longer comes from operating better; it comes from adapting faster. This creates an urgent need for a new generation of leaders who have a strategic mindset and can build organizational resilience. Winning them over cannot be based on budget alone. It requires a comprehensive retention and executive recruitment strategy, built on real data and deep market insight.

The full Talentnet-Mercer report will provide your business with:

• Detailed compensation data by industry and level, helping you benchmark your pay policies.
• Analysis of salary increase trends and turnover rates to help you plan your HR budget and retention strategy.
• Insights into workforce structure and critical jobs.
• Data on bonuses and sales incentives, helping you design a competitive rewards package.

Don’t let the war for senior talent become a race to burn cash.

Arm yourself with data to build a sustainable talent strategy based on real market insights and what truly matters to the best leaders.