CIBC CEO Gerry McCaughey announced this week that he would be retiring, with no clear succession plan in place.
Executive succession planning is often neglected, according to York University professor Richard Leblanc, who said there was a “real disconnect” between the importance of planning and what boards do to address the issue.
“[CIBC] have a legacy of this notion of horse races, which is high risk because it could lead to departures, depending on which horse actually succeeds,” Mr. Leblanc said.
Board chair Charles Sirois claims the speculation is unnecessary and the board is “fully ready to identify the next successor and will do it fully by not only looking internally but [also] externally.”
However, the bank is one of four to face recent leadership changes and is the only one that did not name a successor in the same statement that announced the retirement.
Discussing RBC CEO Gord Nixon’s retirement, and his successor Dave McKay, RBC SVP Leadership & Organization Development Helena Gottschling told HRM the bank has clear succession plans in place for its top 75 positions.
“One of my accountabilities is succession planning and I work very closely with the HR business partners across the organization in identifying talent and working with the business and functional leaders in identifying talent within their areas,” she said. “We report to the HR committee of the board on both our non-executive high-potential strategy
, as well as reviewing succession plans for our top 75 plans across the organization.”
Like many organizations, RBS was adapting its approach as necessary to find better candidates, including assessing role requirements to ensure they understand what is required for success, rather than assuming a successor must have the exact skills the incumbent has.
They also looked to leaders to bring the next generation up behind them.
“Essentially each leader has an accountability to help develop their own successors so it’s not only an HR accountability it’s also a leader accountability,” Gottchling told HRM.
Succession planning is one of HR leaders’ biggest concerns, according to a 2013 HRM Online survey, but even Canada’s biggest organizations are failing to plan far enough ahead.