Blog : BOARD TALK
|Posted on December 28, 2011 at 6:30 PM|
Chairman succession planning is not widely discussed in most UK plc boardrooms . Not surprising, as there are few formal mechanisms for addressing the issue. But perhaps there should be more, as the role is getting harder, requiring wider experience than is possible from a straight shift from being a CEO to Chairman.
Headhunters Spencer Stuart have done some interesting analysis. They say that at the time of writing (December) , some 42 FTSE150 companies had appointed a new chairman over the previous two years, which is (historically) a very high rate of change. Their average tenure is barely four and a half years — shorter by over six months than a decade ago. Chairmen apparently change at about the same rate as CEOs.
Their analysis suggests that out of the 60 chairmen of FTSE 100 companies who have been CEO at some point, just over half have had a gap between finishing their executive career and embarking upon life as a company chairman. Often that gap is spent acquiring experience as a non-executive director.
But, says Spencer Stuart, only a minority of FTSE 150 CEOs have non-executive roles with other listed companies. For the rest, the day job is too demanding to allow them to spend time outside the company.
It adds ; "Over the long term, there is certainly a need for aspiring chairmen among the executive community to develop their skills as non-executives and spend time observing other chairmen than their own."
You can read more on this excellent research here.