Hiring a chief financial officer, a country head or a regional leader is one of the most consequential decisions a company makes. Most Singapore employers use an executive search firm for these roles, and one of the first questions they ask is how the fees work. This guide explains the two main models, what each pays for, and how to choose between them.
The two models
Retained search. You engage one firm exclusively for the role and pay the fee in stages as the search progresses. A common structure is three instalments: one at engagement, one when the shortlist is presented, and the balance when the candidate starts. The firm commits dedicated consultant and researcher time, maps the market and approaches named candidates, including people who are not looking.
Contingency search. You pay only if the firm introduces the candidate you hire, usually on the candidate’s start date. The fee is calculated as a percentage of the candidate’s total annual remuneration. There is little or no upfront cost, and you may brief more than one firm.
Fee levels vary with seniority, complexity and the scope of the search. Ask for the percentage and what counts as remuneration (base salary only, or including fixed bonuses and allowances) in writing before you start.
What a retained fee pays for
The staged payments fund work that happens before any candidate is presented:
- A detailed brief agreed with the hiring manager and, often, the board.
- Market mapping: identifying the people who hold comparable roles in your sector and region.
- Confidential, named approaches to passive candidates.
- In-depth assessment and referencing before a shortlist is presented.
- Regular progress reporting.
This matters most when the best candidates are not on the market, when the search must be confidential, or when the role is unusual enough that a database search will not find the right people.
When contingency works well
Contingency suits roles where there is a reasonable pool of active and semi-active candidates, the brief is well defined, and confidentiality is less of a concern. Many senior specialist and upper-middle management roles fall into this category. The lower upfront commitment also suits employers who want to test the market before committing to an exclusive search.
The trade-off is that a contingency firm is paid only on success, so it will naturally prioritise candidates it can place quickly. On a hard search, that can mean less depth of research.
Which model to choose
Retained search usually fits when:
- the role is C-suite, country head, board level or a confidential replacement;
- the candidate pool is small or mostly passive;
- the cost of a wrong hire or a long vacancy is high.
Contingency usually fits when:
- the role is senior but the candidate pool is reasonable;
- speed matters and the brief is clear;
- you want to keep upfront costs low.
Guarantees and terms to check
Whichever model you choose, check these in the engagement letter:
- Replacement guarantee. How long it lasts from the candidate’s start date and what triggers it.
- Refunds. Whether staged fees are refundable if the search is cancelled. In retained search they usually are not, once each milestone is met.
- Exclusivity. Whether the firm has an exclusive mandate and for how long.
- Off-limits. Which companies the firm will not approach because they are its clients.
- Licensing. In Singapore, employment agencies, including executive search firms, must hold an Employment Agency licence from the Ministry of Manpower. You can check a firm’s licence on the MOM website.
How we work
People Profilers has run executive search in Singapore since 2010 under MOM EA Licence 10C3804, and offers both models. Retained searches are paid in three staged instalments and carry a three-month replacement guarantee from the candidate’s start date. Contingency searches are paid on commencement as a percentage of total annual remuneration. Every engagement starts with a scoping conversation, after which we recommend the model that fits the role.
For roles below executive level, our permanent recruitment team works on a tiered fee with a replacement guarantee.
Contact our Singapore team to discuss a senior hire.
