London, 19 May 2017 – A poll out today from ICSA: The Governance Institute and recruitment specialist The Core Partnership finds that just one in seven organisations polled (14%) think that their CEO should go on to become their organisation’s chairman. Over half (52%) are against it, with a further third (34%) sitting on the fence.
Whilst the majority of responses were opposed to chief executives taking on the role of chairman, except as an interim solution, certain circumstances were highlighted as warranting such a position, such as:
- Death/casual vacancy
- To ensure continuity
- The candidate, the needs of the business and the candidate pool at the time of the vacancy
- When they are a visionary but wish to take a step back from day to day management
- If the organisation was in a situation of significant change or crisis and the board took the decision that it was in the best interests of the organisation for the CEO to become chairman
- Exceptional circumstances in which investors wanted the CEO to become chairman or such a move was vital to the ongoing success of the business
- In small private companies, where knowledge of the business is fundamental or family style businesses.
Potential dangers highlighted comprise too much knowledge limiting independence and the extent to which the former CEO’s ongoing presence as chairman might hinder any efforts by the incoming CEO to effect cultural or strategic change.
‘It is clear from the responses that most people would prefer to see a period of time elapse before a chief executive take up the chairman’s role,’ says Peter Swabey, Policy and Research Director at ICSA: The Governance Institute. ‘This seems sensible given that a chairman is expected to bring a certain level of independence to the role and switching from an executive mindset to more of a stewardship role is unlikely to happen overnight. Different skill sets are required for each role, but good governance and having proper checks and balances in place to ensure independence should help to avoid problems in those unusual situations where it is the appropriate response.’
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For further information, please contact Maria Brookes, Media Relations Manager:
+44 (0)20 7612 7072
+44 (0)7890 649 143
Notes to Editors:
1 ICSA: The Governance Institute is the professional body for governance. We have members in all sectors and are required by our Royal Charter to lead ‘effective governance and efficient administration of commerce, industry and public affairs’. With over 125 years’ experience, we work with regulators and policy makers to champion high standards of governance and provide qualifications, training and guidance.
Website: www.icsa.org.uk
2 The Core Partnership is a niche market recruitment consultancy working with Company Secretaries and their teams to advise on and resource their specialist interim and permanent manpower needs. With relevant professional backgrounds spanning back to the 1980s, The Core Partnership has a wealth of knowledge of the development and dimensions of the role of the Company Secretary. The team provides market advice on relevant qualifications and experience, conducts salary and benchmarking exercises and works throughout the UK and overseas recruiting at all levels to this specific discipline.
Website: www.core-partnership.co.uk
3 More detail about the poll findings can be found at www.icsa.org.uk/knowledge/governance-and-compliance/indepth/comment/quick-question
