The nominating/governance committee generally has responsibility for board succession planning, and it may also lead the board’s work overseeing CEO succession planning. Both roles, arguably the most important responsibilities of the board, are of vital importance to a company’s success. Effective succession planning enables boards to make the best decision for the company in the event of planned or unplanned transitions.
This article highlights best practices for CEO succession planning and three key steps for effective board succession planning.
CEO succession planning best practices
- Address succession planning early and with regularity
- Ensure the strategy and criteria for the next CEO is forward-looking
- Include the CEO as an active participant in the succession planning process
- Assure the development of a robust succession pipeline
- Thoughtfully and effectively assess internal candidates
- Engage with internal candidates
- Incorporate external benchmarking
- Plan for the transition