Headhunter is one of those alarm-bell words. In common with expressions such as “profit warning”, “strategic importance” and “corporate jet”, it is enough to instil fear in any wealth-respecting investor. It is not so much that headhunters sit at the bottom of the social respectability pecking order with journalists, politicians and estate agents, it is more that a company in need of headhunters may need help on other fronts too. It smacks of weakness, lack of foresight and drift.

If a company is unable to replace its leaders from within, might its product development people — buyers and marketers, financial controllers, engineers and technicians — be splashing about in pools of talent that are similarly shallow? And, or even at the same time, the presence of headhunters may suggest that a company is putting too little faith in employees and pinning too much hope on finding some kind of corporate Messiah. Yes, inspirational leadership is essential but the individual leader normally has only the combined power of those he or she works with. Hiring from outside saps institutional memory. It is risky since the devil you know is usually preferable to the devil you do not.

It is all the more worrying when the H-word appears with the name of a company in banner headlines, and when stories about high-level appointments, or the lack of them, remain in prominence for weeks or months on end. The danger is that operational decisions are left unmade, that opportunities are wasted, that corporate morale will drain away.

Take ITV, the commercial broadcaster, as a case in point. It is not the first company to find itself scratching around for leadership talent and no doubt it will not be the last. Also undeniable is that recession has hit ITV hard. Advertisers have drawn in their horns across the board and other media, notably on the web, have snatched market share. But investors cannot, surely, help but be dismayed by the fact that for the second time in three years ITV finds itself in headhunter hell.

Or consider Marks & Spencer. The retailer has fared better than ITV — indeed, under Sir Stuart Rose, it has regained some of its former glory. Yet it is still disappointing to see it casting around for a new chief. It appears that Justin King of Sainsbury’s, Simon Wolfson of Next, Marc Boland of Wm Morrison and now Charlie Wilson of Booker have all said thanks, but no thanks.

It would be wrong also to suggest that headhunters are bad news, full stop. Company cultures can become stale and might need the injection of fresh talent. The tastes and needs of customers also change, and that obliged a company to look outside for someone with the skills more suited to meet challenges posed by new imperatives. A change of leader, meanwhile, is one of the signs that investors looking for recovery plays might latch on to. A change at the top may spur a change in share price fortunes, though it did not happen when Michael Grade was appointed to ITV, a reason for this columnist to eat some humble pie.

Shareholders, meanwhile, must shoulder some blame for creating the gaps that headhunters are paid to try to fill. It was shareholders in ITV that called for the head of Charles Allen, the former head of the commercial broadcaster, to be served up on a platter in 2006. Though ITV had endured a torrid time and had seemed to make some big mistakes (remember ONdigital?) it looked foolish to oust Allen, and even more foolish to force him out before a replacement was found. In the circumstances, ITV did well to secure the services of Michael Grade but it would have been better, surely, if shareholders had said less about what they didn’t want and more about what they did require.

And so look at Tesco. It would be a mistake to suggest that the share price performance of these three companies is directly related to the issue of top-level succession planning. At the same time, however, it is striking to note the difference and wonder what sort of effect is wrought by the presence, or absence, of headhunters.

Tesco’s chief executive, Sir Terry Leahy, was in the news this week for criticisms he levelled at the British education system. Tesco, he said, was left with the responsibility of giving many of its young employees the basic skills that he, and many others, would have thought school leavers would have acquired in the classroom. It is almost unimaginable that Tesco will do anything other than promote from within when it comes to finding a successor to Sir Terry. He was a product of the Tesco school of management and, as well as teaching its young staff the facts of working life, it is all but a certainty that Leahy’s successor will be trained in Tesco’s own ranks. Shares in the supermarket and other companies with strong credentials for breeding management such as GlaxoSmithKline, BP, HSBC, Rolls-Royce, and Serco should be among the first to be considered by private investors. Sadly, there seem to be many more large UK companies that look outside their ranks for senior staff.

Just think how you would like it if headhunters were seen circling Tesco. The respect and admiration it now enjoys would evaporate before you could say: “Rebase the dividend”.

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