Society public company members across sizes and industries responding to the most recent Society / Deloitte Board Practices Quarterly survey: “CEO succession planning processes” provided insights on their corporate and board CEO succession-related practices, including succession plan content and review, succession planning responsibility and involvement, and public disclosure.
Among the takeaways:
Plan prevalence (n=94) — Just over two-thirds of companies represented by respondents have a CEO succession plan for a planned departure, while 80% have an emergency succession plan. A majority of plans are formalized/documented.
Plan content (n=69) — A majority of non-emergency succession plans include named individual(s) internal to the company as potential CEO successors (80%) and procedures for the board and/or responsible board committee (e.g., plan review and approval, candidate interviews) (54%). Nearly half include professional development and readiness plans for internal candidates and candidate criteria (e.g., qualitative and quantitative skills and other attributes).
Plan review/update cadence (n=71) — Nearly three-quarters of boards (72%) and a plurality of responsible board committees (39%) represented by respondents review the company’s CEO succession plan annually.
Responsibility & involvement (n=70) — The full board has primary responsibility for CEO succession planning at a majority of companies, followed by the compensation (or similar) committee. While CEOs are not commonly tasked with primary responsibility (24%), they are involved in developing and reviewing the plan and identifying candidates at most companies, as detailed here:
Disclosure and shareholder engagement (n=66) — Less than 20% of respondents indicated that their shareholders had discussed or asked to discuss CEO succession with management and the board, and public disclosure about the process has not changed measurably in several years.
Responses tended to vary by company size. Access the survey results online and by company size here. Small-cap and private company findings were omitted from the report and the accompanying demographics reports due to limited respondent populations; however, members may access those results by emailing Randi at rmorrison@societycorpgov.org.