Attracting and retaining talent: Cultivating a people-first strategy in the energy sector

In this podcast, Heidrick & Struggles’ Stefano Salvatore speaks to Andy Brown, CEO of Galp Energia, one of the leading companies in Southern Europe in oil and gas, and now also in solar assets. Brown shares his insights on where the energy sector is today as well as how Galp is responding to the sector’s continuous changes and volatility. He also shares how Galp is rethinking its people strategy to become more people first and what the company is doing to attract and retain talent.

Some questions answered in this episode include the following:

• (1:06) As a leader of a major energy player in Southern Europe with a presence in other key markets such as Brazil and Africa, could you give us your perspective on where the energy sector is at the moment, as well as how Galp is responding to the continuous changes?
• (3:27) You've recently announced a pioneering joint venture between Galp and Northvolt to develop Europe’s largest and most sustainable lithium conversion plant. How is this partnership going to impact the energy sector and what does it mean in terms of that cross-collaboration between two very different organizations, cultures, and businesses?
• (5:19) What new changes are you seeing and requesting from your present workforce and, probably, your future workforce?
• (6:48) What changes in culture and talent are going to happen in the energy transition, and how are you going to address them?
• (10:09) Do you have specific strategies in place to attract and retain top talent?

Below is a full transcript of the episode, which has been edited for clarity.

Welcome to the Heidrick & Struggles Leadership Podcast. Heidrick is the premier global provider of senior-level executive search and leadership consulting services. Diversity and inclusion, leading through tumultuous times, and building thriving teams and organizations are among the core issues we talk with leaders about every day, including in our podcasts. Thank you for joining the conversation.

Stefano Salvatore: Hi, I'm Stefano Salvatore, managing partner of Heidrick & Struggles Portugal and Spain. In today’s podcast, I'm talking to Andy Brown, CEO of Galp Energia, one of Southern Europe’s leading oil and gas companies, now also in solar assets—a testament to its commitment to the energy transition. Andy joined Galp as CEO and vice chairman of the board of directors in February 2021. Andy spent 35 years of his career at Royal Dutch Shell, where he held various senior leadership roles across geographies.

Andy, welcome. Thank you for taking the time to speak to us today.

Andy Brown: Thank you.

Stefano Salvatore: Andy, as a leader of a major energy player in Southern Europe with a presence in other key markets such as Brazil and Africa, could you give us your perspective on where the energy sector is at the moment, as well as how Galp is responding to the continuous changes?

Andy Brown: Yes, well, Stefano, this is a unique time in the energy business. I don't think I've ever seen it quite so volatile. Gas prices are at record levels and oil prices are very high. But everyone's talking about the transition—and so they should, because the world’s energy system will have to change. But I think the world needs to realize that it’s a transition; we don't just turn a switch and become a new system. Just over 20% of the world’s energy is delivered through electricity, so people need to realize that there's a massive change that has to take place. But Galp’s taken on that challenge. We're a traditional oil and gas company, but we've said we're not going to drill any more frontier exploration wells. We’ve said we’ll spend half our money, 50% of our capital, on renewable energy, energies such as hydrogen, biofuels, the battery value chain, and electric vehicle (EV) charging. So, we really want to drive this transition fast.

Stefano Salvatore: Thinking about that transition and also looking at the European Green Deal, how are they going to affect Galp’s strategy, its leadership, and culture?

Andy Brown: By 2050, Galp will be unrecognizable. We’re going to have to completely change the products we sell and the core skills of the company. We're going to have to develop new talent and change the way we work and, of course, with digital, that will be magnified. So, this is a massive transition. But there are some core skills involved in generating energy and converting it, for instance, into hydrogen—hydrogen fuels, biofuels—and selling to customers that will stay. So, there is a core thread of generating energy and delivering it to customers that will remain, but the types of energy and the way we deliver it will be very, very different.

Stefano Salvatore: You've recently announced a pioneering joint venture between Galp and Northvolt to develop Europe’s largest and most sustainable lithium conversion plant. How is this partnership going to impact the energy sector and what does it mean in terms of that cross-collaboration between two very different organizations, cultures, and businesses?

Andy Brown: Well, I think, first, that any change creates lots of opportunity. Batteries and batteries in electric vehicles—we can imagine there’ll be a tenfold increase in demand for those batteries between now and 2030. Northvolt, one of the leading battery manufacturers in Europe, clearly recognized that trend, and it was a great opportunity to create a joint venture. Portugal has lithium resources; undoubtedly that’s one of the reasons why Northvolt is interested to set up here in Portugal. But I think they find in Galp a company with an industrial background and an ability to build the type of facilities that they will need. And it’s this, I think, a remarkable combination of a traditional oil and gas energy company with a very young, nimble, growing battery manufacturer that is so exciting for us. We see different ways of working and we see a focus on people that I think is teaching us lessons about what it will take to be successful in the future, centered around getting the right people in place to deliver on our ambitions.

Stefano Salvatore: It’s about both people and processes. On that point, you know, and considering digitalization, what new changes are you seeing and requesting from your present workforce and, probably, your future workforce?

Andy Brown: This whole innovation and digital space is clearly a catalyst for the change. Digital creates opportunities that will allow us to optimize our business. It gives us new insights into where value can be created but most importantly can show us new and different ways to delight customers. We’re going to go from a very centralized energy system to a very distributed energy system, and that is going to require digital applications and innovation to make it work.

Digital is also about having some real discipline around data. So, having discipline around cybersecurity and being able to embrace the cloud and artificial intelligence. But, I think, it’s probably most important to be open to partnerships, to have an open innovation platform, rather than one like what a traditional company like Galp would have had in the past, a company that is very closed and has its own skills, that is more inward-looking. So, this transition from being inward-looking and closed to being open—willing to risk, willing to be agile, I think, is a massive change for us.

Stefano Salvatore: Picking on that point, what changes in culture and talent are going to happen in the energy transition, and how are you going to address them?

Andy Brown: So, not only will the nature of the products we have to produce be turned upside-down, but the way we go about our business will be as well. Galp is a traditional state-run company that has been privatized but is still extraordinarily hierarchical, and in order to get the best out of the people— Galp has fantastic people—we need to be able to delegate, to allow people to experiment, to allow people to fail and learn and grown, and this is not traditional in Galp’s culture. So, that is the core of our people strategy, to focus on what we call our “change agility.” We’ll focus on our ability to be externally focused. We’ll also change how we work internally, but at the same time stay focused on results while being open to continuous improvement all the time. We need to be asking, “How can I do this better? Do I need to do this process, or can I make it simpler?” So, those are the core parts of the people strategy or, rather, the behavioral side of the people strategy that we're going after.

Stefano Salvatore: And what are you asking of those people in terms of leadership capabilities? Obviously, you’re asking them to be more empowered. What else are you looking for?

Andy Brown: The first thing we’re doing is working with the top 60. I think leaders have to demonstrate what they're preaching, and so those top 60 leaders are going to be a particular focus of attention for us—how they're providing that engagement, providing that delegation. And it’s interesting: what we've discovered is that you can drive accountability lower in the organization but if you haven't equipped the organization to take on the accountability, it actually bounces back up. And you have to avoid that. You also have to give people a sense of what it means to discharge accountability—that it’s a safe place for people to ask questions but to make decisions. And I often think, in terms of leadership, it’s about moving from always thinking through the possible solutions and making decisions to leading in a way that’s more about how you do it and how you encourage people to innovate. It’s not about doing or telling; it’s about setting examples. And so, that way of leading, I think, is going to be really important for us, because in the culture we have today, people wait for instructions rather than step up and say, “I know how I can do this.” But that's going to take some years. It doesn't happen because I say so, it will happen through getting the right people in place, emphasizing the right behaviors, rewarding people in the right ways, and creating a culture in the company where people feel empowered to use all their skills and to innovate and to create value.

Stefano Salvatore: Andy, on the subject of talent, do you have specific strategies in place to attract and retain top talent?

Andy Brown: We've been addressing this recently. We can see that there has been a lot of resignations, particularly in the United States, I think. So, retaining people and being able to attract them is core to our success in the future. The first thing we worked on is making sure we’re paying them the right amount of money. We did a complete remuneration survey and benchmarked ourselves—and some peoples’ salaries almost doubled, just to give you a sense of how far off we were.

But that's not all. It’s also about people being clear about the company’s purpose. Our purpose in Galp is to “regenerate the future together,” and our people having a sense that this is a company on the move to address the climate challenges is going to be important, particularly for young people.

We also talk about making Galp a great place to work and that's about how we allow talent to develop and how we delegate, but it’s also about the atmosphere in the office—moving away from stuffy towers and toward a much more open workplace. When I went to Northvolt in Sweden, it was just incredible how it was so different—the feel and touch of the place. These are important things, as flexibility. We’ve moved to a flexible working model where people have to work at least two days a week in the office. Depending on their boss, that could be only two days in the office and three days at home, which is a much more modern way of leading people. But I really think that people often leave companies because of their boss, not because of the company. They leave because they're not being well-led. So we’re focusing on leadership. Our top 60 have all had leadership assessments, giving them a sense of where they could be better leaders, what they need to work on, and I think that in itself will also create an environment where the people who work for them, you know, another five hundred, are going to want to work at this company because they've got a good boss.

So, working on leadership, working on how well we pay people, giving people a purpose, and having a great office environment with flexible working—that's how we’re working on retention and attraction.

Stefano Salvatore: Right now, there's a lot of volatility and uncertainty. You, Andy, have gone through many changes yourself over the years—different organizations, different countries. What have you learned as a CEO over these past few years, and from whom?

Andy Brown: Yes, look, I think you go through your career and you do role model, you do observe leaders, and every leader has their strengths and weaknesses. I was obviously very lucky to be on the leadership team of Shell for seven years and, you know, I bring some of what I learned there into this job. But I'm learning all the time, learning how to manage through ambiguity, learning to be more of an entrepreneur than an engineer, learning to empower, learning very much to lead rather than manage. I think it’s so important to create an environment where it’s not about how many hours you put in at the office but about the signals you give, the people you recruit, the behaviors you emphasize, and the networks you create. Talking to staff, talking to stakeholders, talking to partners, that's where I can add value. I have had to kind of relearn what success looks like, and success is very different now as a CEO than it was when I was an engineer.

Stefano Salvatore: What a journey. And, you know, looking over the next three to five years as the CEO of Galp, what are the specific leadership skills and capabilities that will be the most important for your company?

Andy Brown: I think we have to cultivate the right behaviors internally and create the right environment. We have a purpose: “Let’s regenerate the future together.” We have to live that purpose in what we do, how we engage society, and how we make Galp a great place to work. I lead leaders that will emphasize those things, that will be externally focused, that will be empowering internally, that will be able to look to the future and see the trends and help us position ourselves in that future energy system. Those are the kind of leaders that I’ll need. I’ll need a lot less of the traditional leaders and hierarchical managers that will do big projects or engineer their way out of a solution. We have to innovate our way into the future. We have to empower our way into the future. And we have to create that entrepreneurial spirit in Galp. It’s a massive challenge, but very exciting.

Stefano Salvatore: I'm sure it is. Andy, all that's left for me to say is thank you very much for sharing your time with us today.

Andy Brown: Thank you.

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About the interviewer

Stefano Salvatore (ssalvatore@heidrick.com) is partner-in-charge of Heidrick & Struggles Iberia, co-head of the Automotive Practice, and a member of the Industrial and Technology & Services practices.