Excerpt from Korn/Ferry Institute.MOST BOARDS THINK IT’S HEDGED, BUT IT ISN’T
By Alan Guarino and David X Martin
The total market capitalization of the world’s publicly traded companies is approximately $40 trillion—shareholder value that is put at risk whenever companies transition to a new CEO. And yet corporate boards are typically not preparing for, let alone truly managing,this risk.
The tales of abrupt or poorly handled CEO transitions decimating stock
prices are legion. Such risk is unnecessary, but boards give CEO succession
only a cursory level of attention, and their approach is mostly qualitative.
CEO departures are no black swan; indeed, they are unavoidable. Nearly
10 percent of S&P 1500 companies lost their CEO yearly between 2007
and 2009.
prices are legion. Such risk is unnecessary, but boards give CEO succession
only a cursory level of attention, and their approach is mostly qualitative.
CEO departures are no black swan; indeed, they are unavoidable. Nearly
10 percent of S&P 1500 companies lost their CEO yearly between 2007
and 2009.
Alan Guarino is Vice Chairman in Korn/Ferry New York's CEO and Board Services practice
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