If 2025 was defined by hesitation, Q1 2026 is defined by release.
The pent-up capital in Private Equity (Dry Powder) has started to deploy in January, triggering a domino effect in the leadership talent market. When deals happen, management teams change.
Our data shows a 22% increase in confidential mandates compared to Q4 2025. The market has shifted from “Maintenance Mode” (replacing people who leave) to “Growth Mode” (upgrading people to drive value).
For Boards, the window to hire “A-Players” without a bidding war is closing. The “Passive Candidate” is waking up.
1. Market Velocity
Metric: Average weeks from Brief to Offer Acceptance.
In 2025, the average C-Suite search took 14 weeks. In Q1 2026, that has dropped to 9 weeks.
- The Driver: Boards are leaving the “Longlist” stage to the executive search firms. They want a focused “Shortlist” of 3-4 pre-qualified candidates to focus on.
- The Risk: Process fatigue. Candidates receiving multiple approaches are dropping out of processes that drag on beyond 3 interviews.
- Our Advice: If you like a candidate, move to offer within 7 days of the final interview. Speed is your highest-leverage negotiation tool right now.
2. The “Hidden” Market
We are seeing a record high in Confidential Searches.
- The Scenario: A shareholder is planning to exit a company in 18 months. They realise the current CEO is a “Builder,” not a “Seller.”
- The Action: They are replacing the CEO before announcing the exit strategy.
- The Result: The best roles in the UK market right now are invisible. They are being filled via headhunters, not LinkedIn ads.
3. Where is the Heat?
The “Hot” Sectors (Talent Shortage):
- Advanced Manufacturing / Defense: Massive demand for COOs who understand supply chain resilience and “onshoring” logistics.
- HealthTech: The shift from “Growth at all costs” to “Profitability” has triggered a wave of CFO replacements. Boards need “Wartime CFOs” who can cut burn rates without killing culture.
The “Cool” Sectors (Talent Surplus):
- Generic B2B SaaS: We are seeing a surplus of CROs (Chief Revenue Officers) from failed SaaS scale-ups entering the market. The challenge for Boards is filtering the “Luck” from the “Skill.”
4. The Counter-Offer Spike
Data: 1 in 3 Offers in Q1 2026 are facing a Counter-Offer.
- The Reality: Incumbent firms are terrified of losing institutional knowledge during this recovery phase. They are throwing cash at resignations.
- The Fix: Money rarely wins a counter-offer battle permanently. We are advising clients to focus on the “Push Factors” (why the candidate wanted to leave) rather than just matching the salary.
- Retention Strategy: If you are worried about losing your own key staff, conduct an assessment now to identify flight risks before they hand in their notice.
5. The “Fractional” Trap vs. The “Interim” Solution
We are seeing confusion in the market between “Fractional” (Part-time, long-term) and “Interim” (Full-time, fixed-term).
In Q1, the demand for interim leaders has spiked for specific projects:
- ERP Implementation: Fixing failed digital transformations.
- Audit Prep: Getting books ready for a Q3 sale.
Warning: Do not hire a Fractional leader for a Turnaround. A turnaround is a 24/7 job. You cannot fix a broken culture on Tuesdays and Thursdays.
6. Forecast for Q2 2026
Based on our current data and own mandate pipeline, we predict:
- Salary Inflation in Niche Roles: Compliance, Risk, and AI-Governance roles will see a further wage spike.
- The “Boomerang” Trend: Large corporates will aggressively target alumni who left for startups that are now struggling.
- Equity over Cash: Candidates will increasingly demand “Exit Bonuses” rather than just higher base salaries.
Action for Boards
Review your LTIPs: Are your equity packages competitive for 2026? 2024 benchmarks are obsolete.
Audit your “Time to Hire”: If your process takes too long, or you do not move with conviction, you will lose the best candidate to a faster competitor.
