Key Takeaways:

The basic tenants of succession planning require continuous focus and consensus and can provide an outline for preparation and vigilance. These include:

• Agreement on short- and long-term company goals
• Needed skills for the position - Keeping the job description of the upcoming vacancy current
• Keep a pipeline of candidates that span an array of various disciplines and experiences

Boards should build in process and policy around board refreshment.

Board composition should be built for purpose - Consider directors with multiple skills and experiences so there is overlap existing in the boardroom.

Succession doesn’t end with appointment – it further requires a robust onboarding system for the new director.

Expanding the board to accommodate new board members before the departure of a retiring director can efficiently provide transfer of institutional knowledge and avoid “reinventing the wheel.”

A board member with shareholder engagement skills and investor understanding that can help management articulate their story is the best defense against activists.

Resources: 

• “What ‘Succession’ Gets Right (and Wrong) About Business Continuity Planning [Spoilers]
• Think Like an Activist