Succession planning for and oversight of the chief executive officer (CEO) is often addressed only once a year during the board’s annual strategy session, despite being a particularly important board function. Recent data suggest that CEO tenure is declining and CEO turnover is increasing. Whether this trend is attributable to normal refreshment, evolving strategies in response to COVID-19, and/or increased instances of mismanagement or misconduct, CEO succession is an important factor that must be considered by a board when planning for the company’s future. In this chapter, we review recent trends in CEO departures, offer practical guidance on succession planning best practices and considerations, and discuss some core disclosure issues that boards should factor into their overall succession planning strategy.
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Governance Insights 2022
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