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Functional Responsibilities of the CHRO

While the specific organization of the CHRO role varies by company and may include both HR and non-HR functions, the CHRO is generally responsible for the following functional areas:


Talent

Based upon the company’s business strategy, goals and objectives, the human resources function will help to ensure there is a pipeline of talent to meet the company’s performance and growth objectives. This requires that turnover is managed effectively, that there is a broad and robust pool of potential external candidates to fill position openings and the establishment of programs to develop the internal bench of talent to fill successively broader and more responsible positions. Additionally, the human resources function must help ensure the company retains high performing and high potential talent through the proper management of training and development opportunities, mentoring, coaching and the allocation of rewards. The focus on talent includes recruiting, hiring, staffing, training, developing talent and building capabilities, integrating, assessing, motivating and retaining skilled talent across the corporation. It also includes employee, management and executive development as well as succession planning. The CHRO is the key resource in working with the board on CEO and senior management succession.

Successful companies are highly selective in hiring, source candidates from a broad pool of applicants, invest in developing all employees, and disproportionately invest in high performing, high potential employees in high impact positions.

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Performance Management

Effective performance management is another area in which the human resources function helps drive the success of the company. Under the CHRO’s leadership the HR function establishes an effective performance management system. HR also works with management to implement the performance management system by establishing clear performance expectations, providing ongoing feedback and coaching, and effectively linking performance to rewards.

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Training and Development

The HR function creates and implements training and development programs to ensure the company has the capabilities to achieve performance objectives and to meet the changing skills needed to compete in a dynamic global marketplace. Training and development initiatives are also critical to building a pipeline of candidates with the requisite skills and experience for successively more responsible functional and leadership roles.

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Culture

The human resources function has a leadership role in helping shape the culture of the company. Ensuring that the values of the company are communicated and understood at all levels, providing clarity as to the expected behavior of all employees and the development of a high performance culture are important aspects of the CHRO role. When an employee’s behavior is inconsistent with the values of the company, the human resources function is responsible for ensuring that such situations are dealt with fairly. The HR function also helps the organization establish and maintain high levels of employee engagement and commitment.

Increasingly companies are relying on external partners, joint-ventures, as well as merged and acquired companies as sources of innovation, capabilities and growth. Establishing a culture that is supportive of such external partnerships is an area where the HR function plays an important role.

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Compensation and Benefits

A key element of the human resources function is ensuring that the compensation and benefits strategy is aligned with and supportive of the company’s business strategy, goals, objectives and culture. The effectiveness of the company’s pay and benefits programs and practices will be measured by the impact on company performance, the extent to which it supports the talent strategy and reinforces the desired behaviors within the company.

In addition to effectiveness, compensation and benefits programs must be cost-efficient to the company, be of high perceived value by employees and fully compliant with legislative and regulatory requirements in the various markets in which the company operates. The human resources function works in partnership with the corporate finance, treasury and legal functions in ensuring appropriate funding and compliance of the compensation and benefits programs.

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Executive Compensation

Working with the CEO and the board of directors, the CHRO provides leadership in the establishment and management of executive pay programs and practices that align the interests of management with those of shareholders and other key stakeholders of the company (institutional investors, regulators, legislators, employees, etc.). Aligning incentives with the sustained creation of shareholder value, strengthening line of sight between pay and performance and aligning compensation programs with leadership development and succession plans are significant responsibilities of the CHRO role.

The CHRO provides support and leadership to the board on executive compensation decisions, ensuring that the communication of pay to various stakeholders supports a pay-for-performance philosophy and working with the finance and legal functions to ensure compliance with accounting, tax and disclosure requirements. Increasingly, the CHRO helps to manage the context within which executive compensation operates by interaction with external influencers and regulators, either directly or through CHRO associations.

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Human Resource Information Systems

Increasingly technology allows companies to more effectively and efficiently manage their human resources. Software or online data tracking services that house employee information such as payroll and benefits, as well as providing information regarding skills development, career growth, and benefit administration, are areas in which the human resources function enhances productivity for the company. In a knowledge-based economy having accurate and comprehensive employee information is an important factor in creating competitive advantage.

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Diversity and Inclusiveness

Companies have an increasingly diverse and global workforce thereby presenting both opportunities and challenges for maximizing organizational effectiveness. The human resources function helps to ensure awareness of the qualities, experiences, work styles and personal attributes such as gender, age, race, religion, disability, and ethnicity that make individuals unique. Leveraging the richness of those differences to enhance and enrich both business performance and operating culture fosters innovation and high performance.

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Employee Relations

Development of a positive culture and cohesive work environment that stresses equal employment opportunity, fairness and consistency in the treatment of employees, effective communications between management and employees, and effective dispute resolution are critical activities served by the human resources function. Further, ensuring that employees are fully involved in and have a strong emotional connection with their jobs and see the connection between their work and the overall goals, objectives and mission of the company are essential elements of the CHRO’s responsibilities.

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Labor Relations

Many companies have a portion of their global workforce represented by formal labor organizations in the form of unions, worker associations or works councils. The CHRO provides leadership and strategy for consultation, collective bargaining, negotiations, union contract administration, grievance handling, arbitrations, communications, and compliance with applicable labor laws.

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Employee Communications

Ensuring the alignment of workforce performance with corporate objectives, understanding employee concerns through employee surveys and focus groups, and educating employees regarding changes in human resources policies and benefits are areas in which the human resources function enhances organizational effectiveness.

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HR Compliance

Companies operate within an environment of an increasing number of laws and regulations governing employment practices, affirmative action, wage and hour, employee health and safety, and labor relations. The CHRO has overall responsibility for ensuring compliance with such laws and regulations and engaging with CHRO associations to help influence public policy on employment.

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Health, Safety and Security

Establishing systems, processes, and cultures designed to reduce or eliminate risks of injuries or illness to employees falls within the responsibility of the HR function. Workers have a legitimate expectation for a secure work environment free of violence and other internal and external threats to personal safety. The CHRO provides leadership to ensure employee health, safety and security through establishment of policies and practices for crisis management, theft and fraud prevention, compliance with occupational safety and health laws and regulations and other workplace safeguards

As is apparent from the various responsibilities outlined above, the CHRO holds an important leadership role within companies and is responsible for key programs and policies that are critical to company success.

 
 
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