CEOs are the primary corporate pillars – both externally and internally. They have a key role to design and implement future-oriented initiatives and growing business culture. And they are the voice of the company and value architects, who go well beyond financial benefit, in our hyper-complex, fast-paced world. One of the main choices and lengthy duties of every Management Board is to appoint the CEO.
In a recent study from Big Four Accounting Company KPMG and authored by Egon Zehnder, the CEO’s succession process presents several challenges to the Board. The board must comply with procedural and formal requirements in terms of substantive decision-making criteria. Furthermore, succession planning affects several stakeholders directly or indirectly. They should be informed, updated, and agreed on the necessary CEO profile while at the same time requiring maximum secrecy in the selection process.
“The criteria of rational choosing play a key part on the one hand; on the other, it is also an emotive decision to analyze and pick the appropriate candidate,” Egon Zehnder stated. “Decision-makers must focus on the challenges of the firm and also take future requirements into account. You must highlight the correct issues (technology, disruption, sustainability, the future markets, structural and societal shifts, megatrends, etc) but also maintain high profits and income.”
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