KORN/FERRY INTERNATIONAL
The Search Begins With
TRUST
3.5 million
Candidates in Database*
$394 million
Global Revenue in Fiscal 2002
8,003
Searches in Fiscal 2002*
538
Korn/Ferry and Futurestep
Consultants Worldwide*
71
Offices Worldwide*
ALL FIGURES INCLUDE FUTURESTEP
* FIGURES INCLUDE KORN/FERRY MEXICO
LEADING THE SEARCH SINCE 1969. Korn/Ferry has set the standard in executive
recruitment for more than 30 years, conducting over 80,000 senior-level searches
for clients worldwide. Today, Korn/Ferry is the world’s premier provider of execu-
tive human capital solutions, with services ranging from corporate governance and
CEO recruitment to executive search, middle-management recruitment, strategic
management assessment and executive coaching and development.
Page One
EXECUTIVE SEARCH
A TRADITION OF TRUST. Today’s increasingly complex business environment demands
leaders with diverse skills, backgrounds and ideas. Executive Search is the key to unlocking that
talent—and the foundation of Korn/Ferry’s leadership position in the human capital industry. Over
the past three decades, Korn/Ferry executive consultants have conducted searches in virtually
every industry, function and region around the globe.
Based in more than 70 offices in 36 countries,
Korn/Ferry executive consultants work closely with
clients to craft customized search strategies. Our
consultants’ commitment to quality — and unmatched
industry, functional and regional expertise —provide
the competitive advantage necessary to recruit and
develop world-class leadership teams.
Global Markets
Effective executive search requires hands-on experience
in the markets you serve. Korn/Ferry Executive Search
consultants offer extensive backgrounds and specific
expertise in the broadest range of global indus-
tries—from Financial Services and Life Sciences to
Consumer, Industrial and Technology.
Korn/Ferry consultants serve clients through a
highly specialized global network of more than 30
market sectors and functional areas of expertise. Our
consultants’ critical industry experience, local knowledge
and unparalleled professional contacts ensure the
highest levels of service—and most effective solutions—
for Korn/Ferry clients worldwide.
Board Services
Korn/Ferry offers a core team of global professionals
whose sole focus is recruiting for boards of directors
and consulting on matters of corporate governance.
Our Board Services division has handled a wide
range of board-level assignments since its inception
in 1972, and its annual Board of Directors Study, first
produced in 1973, is the definitive source of informa-
tion on board and governance trends.
CEO Services
Korn/Ferry’s CEO Services division specializes in
identifying and placing superior candidates at the
highest levels of both public and private organizations.
Our dedicated consultants conducted more than 400
CEO searches in 2002 and possess the requisite
expertise — and global candidate network — to find
the most qualified leaders for each unique assignment.
Candidate Services
Korn/Ferry has been placing senior-level candidates in
exclusive leadership positions for more than 30 years.
Our consultants are committed to finding the best
talent for our clients — and to helping our candidates
achieve their personal career goals.
Senior-level candidates register with Korn/Ferry
through the e-Korn/Ferry Executive Center. The
Executive Center Web site enables qualified profes-
sionals to review current opportunities and submit
their digital resumes — quickly and confidentially —
to Korn/Ferry consultants worldwide. Currently, the
Korn/Ferry senior executive database includes more
than 2.3 million candidates.
Integrated Services
In 2002, Korn/Ferry launched Integrated Services, a
strategic account management solution for major
international clients. The program serves global
clients through a dedicated team that is led by a single
point of contact and supported by local relationship
managers. Providing seamless access to Executive
Search and other Korn/Ferry products, Integrated
Services is the most efficient human capital solution
for multinational organizations.
Page Two
Engagements by Function
Fiscal 2002 Assignments
10% CEO & Board
44% Senior Executive & General Management
7% Finance & Control
7% HR & Administration
4% Information Systems
8% Manufacturing/Engineering/R&D/Technology
20% Marketing & Sales
Engagements by Industry
Fiscal 2002 Assignments
20% Financial Services
15% Healthcare Products & Services
5% Education/Not-for-Profit
7% Retail
5% Professional Services
2% Entertainment & Media
10% Consumer Goods
4% Energy
15% Advanced Technology
17% Industrial
Engagements by Region
Fiscal 2002 Assignments
38% North America
13% Latin America
16% Asia/Pacific
33% Europe
410
CEO Searches in 2002
117
Number of Fortune 200
Clients in 2002
68%
Repeat Business in 2002
FIGURES ARE FOR FISCAL YEAR ENDING APRIL 30, 2002
Page Three
P A G E T H R E E
FIGURES INCLUDE KORN/FERRY MEXICO
STRATEGIC MANAGEMENT ASSESSMENT
& EXECUTIVE COACHING
A MODEL OF SUCCESS. The assessment of executive talent is an essential—yet
elusive—element of any successful business strategy. In 2001, Korn/Ferry developed a statistically
validated competency model, based on the world’s largest executive database, to enhance the
assessment process. The new model—combined with Korn/Ferry’s 12 years of assessment
experience—resulted in Strategic Management Assessment, a unique service that blends
proprietary technology, “market for talent” expertise and predictive validity in a combination
never before available to corporate clients.
Validated Instruments & Customized Process
Utilizing a global database of close to 1 million assessed
executives, Korn/Ferry professionals developed
validated “Best in Job” profiles for positions across a
range of industries and cultures. The profiles capture
the key competencies of the most successful executives
within each position category. When assessing execu-
tives, Korn/Ferry consultants combine the profiles with
a customized menu of values deemed critical by
the client.
Web-Enabled Technology
The entire Strategic Management Assessment process
is backed by Korn/Ferry’s proprietary, Web-based
technology. Our assessment tools allow our consul-
tants to tailor each assignment to the specific needs of
the individual client — and to generate results in real
time. Clients can access all of their data online and
run customized analyses at any time during a project
or after its completion.
Executive Coaching
In 2002, Korn/Ferry joined forces with Dr. Marti Smye,
one of the world’s leading behaviorists and executive
coaches, to offer high-end, post-assessment coaching
services. Korn/Ferry provides executive coaching and
development through Dr. Smye’s international team
of senior consultants. For each assignment, consult-
ants are matched to the individual based on their
expertise, helping to ensure that the coaching process
results in a developmental plan that meets the indi-
vidual’s and client company’s business objectives.
POSITION PR OFI LE
Thinking and Leadership Styles
Emotional Competencies
Thinking Styles Fit with Job Demands
Degree of Fit: 97%
Leadership Styles Fit with Job Demands
Degree of Fit: 58%
Emotional Competencies Fit with Job Demands
Degree of Fit: 72%
Action-
Oriented
Flexible
Complex
Creative—
Biggest Gap
Task
Social
Intellectual
Participative—
Biggest Gap
Positive
Outlook
Inter-
personal
Concern
Self
Concept
Uncertainty
Tolerance
“Best in Job” Profile
Sample Executive
Korn/Ferry assesses executives against customized client parameters and “Best in Job” profiles for the given position.
SA MPLE E XECUTIVE
Page Four
FUTURESTEP
TRADITION MEETS TECHNOLOGY. Futurestep, a Korn/Ferry International company, is the
global leader in middle-management recruitment. Drawing from Korn/Ferry’s more than 30
years of industry experience, Futurestep creates customized recruitment strategies based on
clients’ individual workforce needs. Whether it’s for a large multinational or a high-growth
middle-market company, Futurestep combines solution-oriented service with today’s leading
technologies to deliver the strongest candidates and fastest cycle times.
Customized Solutions
Futurestep offers clients a multi-tiered portfolio of
services — ranging from middle-management search
to project recruitment and integrated managed services.
Each Futurestep solution benefits from the in-depth
industry and functional-area expertise of our global
consultant network — guaranteeing that clients work
with people who understand their business and have
the knowledge base to qualify candidates effectively.
Global Reach
Futurestep was the first company to combine traditional
search expertise with the reach and speed of the
Internet. Futurestep consultants— based in more than
20 countries— have instant access to the world’s largest
database of prescreened middle-management profes-
sionals. The global candidate pool complements our
international presence and multi-channel sourcing
strategy to ensure speed, efficiency and quality of service
for clients worldwide.
1.2 million
Candidates in
Futurestep Database
2,419
Futurestep Searches
in Fiscal 2002
Candidates by Industry
Futurestep Global Database
22% Advanced Technology
12% Industrial & Energy
15% Financial Services
5% Entertainment & Media
5% Healthcare Products & Services
6% Education/Government/Not-for-Profit
8% Consumer Goods
11% Professional Services
16% General/Other
Searches by Industry
Fiscal 2002 Assignments
17% Advanced Technology
21% Industrial & Energy
16% Financial Services
3% Entertainment & Media
6% Healthcare Products & Services
3% Education/Government/Not-for-Profit
11% Consumer Goods
9% Professional Services
14% General/Other
Page Five
KORN/FERRY
Worldwide
Korn/Ferry is the world’s leading executive search firm,
with more than 70 offices throughout the Americas,
Europe and Asia/Pacific.
1969
Lester Korn and Richard Ferry establish
Korn/Ferry in Los Angeles.
1970
Korn/Ferry becomes first executive search
firm to establish a specialized industry
practice with launch of National Real
Estate practice.
New York office opens.
1971
National Energy specialty practice established.
Houston and Atlanta offices open.
1972
First European offices open in Brussels,
Luxembourg and London.
First annual Korn/Ferry International
Executive Demand Index published.
National Financial Services specialty
practice established.
San Francisco and Chicago offices open.
1973
Korn/Ferry becomes the first major U.S.
executive search firm in Asia with opening
of Tokyo office.
First annual Korn/Ferry Board of Directors
Study published in North America.
1978
Offices open in Hong Kong, Caracas and
Kuala Lumpur.
1979
Offices open in Sydney and Frankfurt.
Dallas office opens.
1974
Paris office opens.
1975
First Latin American office opens in
São Paulo.
National High Technology practice
established.
Singapore office opens.
1977
Fortune magazine cites Korn/Ferry as the
leading executive search firm in the world.
Merger with Hazzard & Associates adds
offices in Mexico City and Monterrey,
making Korn/Ferry the dominant search
firm in Latin America.
Page Six
Retail/Fashion specialty practice established.
1980
Office opens in Stamford.
1981
Offices open in Melbourne, Newport Beach
and Washington, D.C.
1982
Boston office opens.
1983
Specialty practices established in Healthcare
and Education.
1985
Korn/Ferry passes $50 million in annual
revenue.
Offices open in Seattle and Buenos Aires.
1986
Korn/Ferry develops a comprehensive,
computerized candidate database.
The Americas ATLANTA | BOGOTÁ | BOSTON | BUENOS AIRES |
CALGARY | CARACAS | CHICAGO | DALLAS | DENVER | HOUSTON | LIMA | LOS ANGELES |
MEXICO CITY* | MIAMI | MINNEAPOLIS | MONTERREY* | MONTREAL | NEW YORK |
NEWPORT BEACH | PHILADELPHIA | PRINCETON | QUITO* | RIO DE JANEIRO | SAN
FRANCISCO | SANTIAGO | SÃO PAULO | SEATTLE | SILICON VALLEY | STAMFORD |
TORONTO | TYSONS CORNER | VANCOUVER | WASHINGTON, D.C.
Europe AMSTERDAM | ATHENS | BARCELONA | BIRMINGHAM | BRUSSELS |
BUCHAREST* | BUDAPEST | COPENHAGEN | FRANKFURT/KOENIGSTEIN | GENEVA |
GOTHENBURG | HELSINKI | ISTANBUL* | LONDON | LUXEMBOURG | LYON | MADRID |
MILAN | MOSCOW* | MUNICH | OSLO | PARIS | ROME | STOCKHOLM | STRASBOURG |
VIENNA | WARSAW | ZÜRICH
Asia/Pacific AUCKLAND* | BANGKOK | BEIJING | BOMBAY | HONG KONG |
JAKARTA | KUALA LUMPUR | MELBOURNE | NEW DELHI | SEOUL | SHANGHAI |
SINGAPORE | SYDNEY | TOKYO | WELLINGTON
*AFFILIATE OR SATELLITE OFFICE
1988
Bangkok office opens.
1990
Korn/Ferry expands into Central and Eastern
Europe, opening its first regional office in
Budapest.
1992
Bogotá office opens.
1993
Korn/Ferry merges with Carré/Orban
in Europe, the largest search firm merger
to date.
Korn/Ferry becomes first major executive
search firm to introduce videoconferencing
capabilities to facilitate the recruitment
process.
Santiago office opens.
1994
First India office opens in Bombay.
Princeton office opens.
More than half of Korn/Ferry professionals
are located outside of the United States.
1995
Korn/Ferry begins development of innova-
tive technology infrastructure, featuring an
international candidate network and propri-
etary executive search software.
Offices open in Beijing and Philadelphia.
2000
Korn/Ferry becomes first search firm to
reach $500 million in annual revenues.
Korn/Ferry launches the e-Korn/Ferry
Executive Center, a Web-based registration
and research tool for senior-level candidates.
1996
Offices open in Shanghai and Jakarta.
Acquisitions in Toronto, Montreal and
Calgary enhance Korn/Ferry’s presence
in Canada.
1997
Korn/Ferry becomes first U.S. search firm
to open offices in Rio de Janeiro.
Korn/Ferry retained by Mexico’s then-
president-elect, Vicente Fox Quesada, to assist
in the search for his presidential cabinet.
New Delhi office opens.
1998
Korn/Ferry launches Futurestep.
Korn/Ferry takes the lead in corporate
diversity issues with publication of
Diversity in the Executive Suite.
First Korea office opens in Seoul.
1999
Korn/Ferry launches IPO on the New York
Stock Exchange (NYSE:KFY).
Vancouver office opens.
2001
Korn/Ferry launches enhanced Strategic
Management Assessment product.
2002
Korn/Ferry retained by U.S. Government
to assist in the hiring of 81 Airport Federal
Security Directors.
Korn/Ferry is the world’s leading provider
of executive human capital solutions,
with more than 70 offices and 500 expert
consultants worldwide.
Page Seven
MARKET LEADERSHIP
Paul C. Reilly
Chairman and Chief Executive Officer
Korn/Ferry International
1800 Century Park East
Suite 900
Los Angeles, CA 90067
+1 310 552 1834
James E. Boone
President, The Americas
Korn/Ferry International
303 Peachtree Street, NE
Suite 1600
Atlanta, GA 30308
+1 404 577 7542
Dick Buschman
President, Korn/Ferry and Futurestep Europe
Korn/Ferry International
123 Buckingham Palace Road
London SW1W 9DZ
United Kingdom
+44 207 312 3100
Gary C. Hourihan
President, Strategic Management Assessment
Korn/Ferry International
2600 Michelson Drive
Suite 720
Irvine, CA 92612
+1 949 851 1834
Robert McNabb
President, Futurestep Americas and Asia/Pacific
Korn/Ferry International
1100 Louisiana
Suite 2850
Houston, TX 77002
+1 713 651 1834
Charles Tseng
President, Asia/Pacific
Korn/Ferry International
50 Raffles Place #28-06
Singapore Land Tower
Singapore 048623
+65 6224 3111
Chris van Someren
President, Global Markets
Korn/Ferry International
123 Buckingham Palace Road
London SW1W 9DZ
United Kingdom
+44 207 312 3100
Cheryl Buxton
Global Managing Director, Life Sciences Market
Korn/Ferry International
7 Roszel Road
5th Floor
Princeton, NJ 08540
+1 609 452 8848
L. Parker Harrell, Jr.
Global Managing Director, Financial Market
Korn/Ferry International
Presidential Plaza
900 19th Street, NW
Suite 800
Washington, D.C. 20006
+1 202 822 9444
Scott E. Kingdom
Global Managing Director, Industrial Market
Korn/Ferry International
Sears Tower
233 South Wacker Drive
Suite 3300
Chicago, IL 60606
+1 312 466 1834
Tierney Remick
Global Managing Director, Consumer Market
Korn/Ferry International
Sears Tower
233 South Wacker Drive
Suite 3300
Chicago, IL 60606
+1 312 466 1834
Steve Strain
Global Managing Director, Technology Market
Korn/Ferry International
One Embarcadero Center
Suite 2101
San Francisco, CA 94111
+1 415 956 1834
Page Eight
KORN/FERRY INTERNATIONAL
1800 Century Park East, Suite 900
Los Angeles, California 90067
Tel: +1 310 552 1834
Fax: +1 310 553 8640
www.kornferry.com
www.futurestep.com
KORN/FERRY INTERNATIONAL
2002 ANNUAL REPORT
The Search Begins With
TRUST
DEAR SHAREHOLDER,
Fiscal Year 2002 will undoubtedly go down as one
of the most difficult 12-month periods in the history
of executive search. After more than a decade of
compound annual growth exceeding 20 percent,
Korn/Ferry’s revenues declined 38 percent last fiscal
year. The implosion of the dot.com economy, the
emergence of the war on terrorism and the seemingly
endless wave of corporate accounting scandals caused
organizations worldwide to slow their recruiting
efforts and rethink their hiring plans.
Our company’s response to this precipitous drop in
demand was swift and decisive—since February 2001
we have reduced worldwide staff by more than 30 per-
cent, shuttered our JobDirect subsidiary, closed
unprofitable offices and cut our annual operating
expenses by more than $100 million.
The short-term impact of the global falloff in the
search market was substantial. Still, Korn/Ferry’s
Executive Search business attained a positive EBITDA,
excluding asset impairment and restructuring charges,
of $6.2 million in Q4 and $22.2 million for the
fiscal year.
Fiscal Year 2002 was also a period of rebirth and of
returning to our roots as the world’s leading recruit-
ment firm. We took advantage of the depressed market
to make some major improvements to our business,
and we streamlined our cost structure and centralized
our back-office support functions to improve efficien-
cies across all business lines.
In December, we unveiled our long-term strategy:
to leverage the strength of our brand and the depth of
our relationships to offer clients a full range of execu-
tive human capital solutions. The backbone of our
business is Executive Search, which we have built to
prominence over the past three decades. Our goal now
is to leverage off of this highly successful platform and
evolve into a solutions provider that offers a variety of
human capital products and services that clients want
and need.
We also strengthened our global markets structure
in December, with the appointment of new leadership
and a more focused definition of global and regional
roles. We formally established our Integrated Services
program, which brings to bear all of Korn/Ferry’s
resources to support multinational clients that have a
variety of recruitment needs across the globe.
This past year we also launched our new Strategic
Management Assessment services. We named Gary
Hourihan to build the business line, and he has led
the development of the most advanced assessment
tools and metrics in the industry. In February 2002, we
rolled out Executive Coaching services as an enhance-
ment to our Management Assessment offerings.
Another positive development was the appoint-
ment of Bob McNabb to head up Futurestep in the
Americas and Asia/Pacific. Bob has broadened the
Futurestep portfolio of services by offering recruit-
ment outsourcing in response to client demands. He
has also reduced Futurestep losses and has begun
rebuilding revenues in a very tough market, particu-
larly in North America.
Despite the recession in North America and the
sluggish European and Asian economies, Korn/Ferry
and Futurestep still conducted close to 8,000 searches
last year, over 3,000 of which were for CEOs, CFOs,
CTOs, board members and other top management
positions. Clients continued to seek us out because of
the strength of our brand, the depth and breadth of
our consultants, and our unparalleled track record of
success throughout the world.
Shortly after the close of Fiscal Year 2002, we
completed a private placement with San Francisco-
based investment firm Friedman Fleischer & Lowe.
The firm invested $50 million of capital in Korn/Ferry
through the purchase of convertible securities. The
investment strengthens our balance sheet and allows
us to invest in our long-term strategies despite the dif-
ficult short-term environment. It also provides us
with a valuable strategic partner for the future.
In addition to the private placement, we strength-
ened our board at the close of the year by adding three
new outside members: David Lowe and Spencer
Fleischer, both vice chairmen of Friedman Fleischer
& Lowe, and Edward Miller, former President and
CEO of AXA Financial, Inc. Richard Ferry, cofounder
of Korn/Ferry, stepped down from his board role but
will continue to provide counsel to the firm. As a
result of these changes, nine of our 12 board mem-
bers are now independent, outside directors. Finally,
in March 2002, we appointed our new Chief
Financial Officer, Gary Burnison, who has proven to
be a great addition to our executive team.
When I joined Korn/Ferry in July 2001, I discov-
ered a company battling a severe drop in industry
demand. But I also discovered an organization rich
with expertise, a brand that was known and respected
in boardrooms around the world, and a culture of
customer focus and deep resiliency.
The demand for recruitment services will return,
and we are extremely well positioned to grow dramat-
ically when it does. By lowering our cost structure and
expanding our products and services, we have set the
stage for renewed growth and improved margins.
When clients seek to add a critical new member to
their executive team, or when candidates consider
making a significant career move, they look to a brand
they can trust. Korn/Ferry stands at the fore of the
human capital industry, and we intend to stay there
for many years to come. Ours is a brand built on
confidence, expertise and, above all, trust.
Paul C. Reilly
Chairman and
Chief Executive Officer
LEADERSHIP
Board of Directors
Paul C. Reilly
Chairman and Chief Executive Officer
Korn/Ferry International
James E. Barlett
Vice Chairman
TeleTech
Frank V. Cahouet
Retired Chairman, President and Chief Executive Officer
Mellon Financial Corporation
Spencer C. Fleischer
Vice Chairman
Friedman Fleischer & Lowe
Sakie Fukushima
Vice President and Director
Korn/Ferry International
Patti S. Hart
Former Chairman and Chief Executive Officer
Excite@Home
David L. Lowe
Vice Chairman
Friedman Fleischer & Lowe
Charles D. Miller
Retired Chairman and Chief Executive Officer
Avery Dennison Corporation
Chairman
Nationwide Health Properties, Inc.
Edward D. Miller
Member of Supervisory Board
AXA
Former President and Chief Executive Officer
AXA Financial, Inc.
Windle B. Priem
Former President and Chief Executive Officer
Korn/Ferry International
Gerhard Schulmeyer
Former Chief Executive Officer
Siemens Corporation
Professor of Practice
MIT Sloan School of Management
Mark C. Thompson
President and Chief Executive Officer
Sentium Leadership Strategies
Chairman
Network Public Broadcasting
Senior Management
James E. Boone
President, The Americas
Gary D. Burnison
Executive Vice President and Chief Financial Officer
Dick Buschman
President, Korn/Ferry and Futurestep Europe
Dan A. Demeter
Chief Information Officer
Peter L. Dunn
General Counsel
Gary C. Hourihan
President, Strategic Management Assessment
Robert McNabb
President, Futurestep Americas and Asia/Pacific
Stephen P. Semprevivo
Chief Administrative Officer
Don Spetner
Chief Marketing Officer
Charles Tseng
President, Asia/Pacific
Chris van Someren
President, Global Markets
Corporate Information
Transfer Agent
Mellon Investor Services LLC
Shareholder Services
P.O. Box 3315
South Hackensack, NJ 07660
Domestic: +1 800 356 2017
International: +1 201 329 8660
www.melloninvestor.com
Annual Meeting
September 24, 2002, 10 a.m.
Century Plaza Hotel
2025 Avenue of the Stars
Los Angeles, California 90067
Legal Counsel
Sullivan & Cromwell
Auditors
Ernst & Young
Investor Relations
Gary D. Burnison
+1 310 226 2613
Media Relations
Don Spetner
+1 310 843 4176
KORN/FERRY INTERNATIONAL
1800 Century Park East, Suite 900
Los Angeles, California 90067
Tel: +1 310 552 1834
Fax: +1 310 553 8640
www.kornferry.com
www.futurestep.com