Succession planning remains one of the hardest challenges boards face, and it is tied closely to board rotation. The challenge is sharpest for public sector boards, where legislated tenures often cap members at two consecutive terms.
The risk is a sudden loss of institutional knowledge when a shareholder appoints an entirely new board. Boards can reduce that risk by being proactive: we recommend proposing to the shareholder that at least a third of current members are retained to ensure a stable transition.
Succession planning is not a box to tick. It protects both the board and the organisation it serves.