The role of Chief Human Resources Officer (CHROs) is evolving rapidly, with a focus on navigating dynamic and complex challenges such as AI, DEI, and sustainability. Egon Zehnder’s recent interviews series with Australian CHROs surfaces their need to balance immediate needs with long-term goals, fostering resilience while drive performance. This reinforces the impetus for CHROs to not just be “guardians for human capital” but true transformation leaders who drive organizational success by role modelling curiosity, resilience, empathy, and self-awareness. Through conversations with 16 CHROs, we explored how these shifts are affecting the role, as well as the essential qualities that CHROs will need to embrace to successfully steer their organization through this dynamic period.
“The CEO uses my role as a key strategic enabler; the CEO fundamentally believes in people and culture and it needing to be a strategic requirement.” – Jane Dionysius (Executive General Manager, People Culture & Governance at Brisbane Airport Corporation)
Rising Complexity Increases the Need for Sophisticated HR
As the world evolves, so does the role of CHROs. Their ability to balance immediate operational needs with long-term strategic goals, while fostering a resilient and inclusive culture, is key to navigating this dynamic landscape. CHROs revealed the key issues they are navigating:
- Sustainability: CHROs are seeing increased pressure from boards for their organizations to meet ESG targets, especially in high-impact sectors.
“Australian safeguard mechanisms add pressure to develop decarbonisation plans more quickly, as well as adding significant cost pressures. Now that we have clarity on the mechanisms and the impact on our business, we have had to adjust our corporate and talent strategy to ensure alignment.” – Emma Pollard (Chief People and Sustainability Officer at Coronado Global Resources)
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Diversity, equity and inclusion: With broadening DEI metrics, stakeholders expect progress beyond gender diversity.
“Diversity, equity and inclusion is a big focus for our board, myself, the CEO, and our shareholders. Much like our ESG focus, certain shareholders have a keen interest in our DEI efforts. We have even incorporated DEI commitments into some of our contracts to ensure alignment with our partners.” – Kris Webb (Chief People Officer at Coles Group)
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Artificial intelligence: AI offers productivity gains but also raises ethical concerns. Leaders see it as a promising technology, but are embracing it with caution.
“AI is having a significant impact on how we do business and service customer needs. We’re excited by that. However, the caveat is that there is a human component to what we do, we value that enormously, therefore it’s important that we have our people working on the right things at the right time.” – Damian Zahra (Chief People Officer at Bunnings)
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Economic and Political factors: Global conflicts and instability as well as economic shifts are affecting supply chains, costs and workforce stability. Determining the right talent at the right place has never been so critical:
“As the U.S. steps back from its historical role as ‘guardian of the seas’, we are considering how this impacts global trade and how we mitigate risks to our supply chains.” – Rob Mill (Chief People Officer at Incitec Pivot Limited)
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Mental Health and the post-Covid world: Labor shortages, employee burnout, multi-generational expectations in the workplace and employee retention are some of the most pressing demands upon talent leaders.
“I have seen a bigger focus on mental health challenges and burn out as one example. Employees have an expectation that their employer will actively seek to address these challenges and they are more likely to move roles if they don’t feel that this is being taken seriously.” – Fiona Darlington (Chief People Officer at IPH Limited)
CHROs must lead boldly with curiosity, resilience, empathy and self-awareness
Amid these rising challenges, CHROs must step up as essential stewards of the business, steering much needed cultural and organizational transformations alongside their top leadership team and the board. These interviews with CHROs reinforce the four essential qualities that CHROs must leverage to guide their organizations through this dynamic period:
1. Curiosity
CHROs have to be alive to the latest developments both inside and outside the organization, continuously updating their view of ‘What Good Looks Like’ to consider new ways of evaluating performance, celebrating success, being inquisitive with technologies such as AI, and developing talent—and clearly communicating it across the organization. Embracing curiosity and being energized by the unknown, learning from others, and actively seeking out information that challenges existing frameworks fosters a culture of continuous learning and foresight, no matter the challenge at hand.
“I have been a professional learner my whole life. I moved to different sectors and like to learn. I like to get involved in the business.” – Danielle Mesa (Chief People and Culture Officer at AirServices Australia)
Moreover, CHROs must exhibit clarity in processing vast amounts of information, rising above the internal politics and drawing out insights from multiple inputs. Understanding the different perspectives of the various stakeholders in the business is key to this, and understanding the perspectives, priorities and frustrations of their ExCo peers will enable them to have a far-reaching impact on the business.
2. Resilience
CHROs need resilience to instill a sense of purpose while balancing performance pressures, multiple objectives and stakeholder interests in shaping the company strategy. They play a crucial role in integrating purpose and performance throughout the business, making active resilience paramount to their success. Additionally, it is vital for CHROs to connect to their personal sense of meaning and foster a culture that encourages others in the organization to do the same.
“To be at your best over a sustained period, it’s crucial to set clear boundaries. There is an art to knowing when immediate action is necessary and when it’s better to be patient and let things unfold naturally. Equally important is knowing when challenges need your direct intervention or when they should be resolved by the team or the system. Striking the balance between urgency and patience not only preserves your own energy, but also empowers others to step into challenges themselves to foster their growth and development.” – Kris Webb (Chief People Officer at Coles Group)
3. Empathy
Central to CHROs’ effort to collaborate with multiple internal stakeholders is the cultivation of empathy—an essential quality that enables them to understand and address the diverse perspectives, capabilities, and challenges present within the organization. Finding allies in other functional leaders, forming a system which can navigate this new stakeholder environment and fostering collaboration and cooperation between them will support this modern way of leading.
“As leaders, we have to bring our authentic self and being vulnerable- we’ve talked about authentic leadership for years, but we have never needed it as much as we do today to connect with our workforce.” – Lisa Burquest (Chief People Officet at Virgin Australia)
By nurturing a culture of empathy, CHROs can lay the foundation for building trust-based relationships among employees, enabling mental-health, and fostering a sense of collective purpose. This internal cultural shift will empower employees to participate actively in driving meaningful progress towards a more sustainable future, aligning their individual efforts with the organization's broader mission. Through effective communication, collaboration, and development, CHROs can inspire employees to embrace sustainable practices and contribute to the success of the company's sustainability goals.
4. Self-awareness
As CHROs continue to shift and expand their identities as leaders, including advocating for and executing the vital business transition towards sustainability self-awareness is self-awareness. CHROs must be willing to shift their identities, looking within to find what holds them back from fulfilling the new expectations that organizations have of them. In other words, creating the space to do what is needed.
“HR practitioners have to be able to push and challenge the business decisions” – Carl Philips (Chief People Officer at Costa)
Reframing CHRO Leadership to Lead Boldly
CHROs are facing a complex mandate that requires a reframing of what success looks like in the function and beyond. This will require a personal transformation, touching on every aspect of a CHRO’s leadership identity. While it may not be a direct lever for the function, CHROs are uniquely positioned to ensure that the organization’s stated objectives and values in relation to sustainability are reflected in how employees are rewarded, challenging senior leaders to act as role models in how they communicate and what they pay attention to and champion, and in ensuring that the capability is in place to drive the sustainability agenda. This will require a deep commitment to change and growth at both the individual and the organizational level.
Ultimately, CHROs must seize the opportunity to lead boldly; paving the way for responsible business, cultural transformation and a sustainable future.
In Egon Zehnder’s recent global CEO study, CEOs acknowledged their roles in navigating an even stronger wave of sweeping change and society-wide shifts—underscoring how CHROs must adapt to help lead large-scale, complex organizational transformation.
