COVID-crisis accelerates boardroom changes

Analysis of UK stock market listed businesses shows that there were 232 board changes in April 2020, compared to a monthly average of 206 changes over the previous two years. There is also a similar trend in May, according to New Street Consulting Group.

Major businesses like Royal Mail, easyJet, Aston Martin and Purplebricks are among those to change their CEOs and CFOs in just the last two weeks. The number of changes at the top in the real estate sector is particularly notable.

The economic impact of the “lockdown” has forced businesses to assess whether their boards have the right mix of skills to respond to the new challenges of the pandemic.

The challenges of leading a business during a time of crisis are often very different to the challenges of growing a business during more benign economic conditions. Our study shows that boards are bringing forward succession plans and accelerating the pace of change to make sure they are able to respond to the crisis.

“We’re now seeing skills like restructuring, cost management, risk management and financial planning & analysis at a premium,” noted New Street, in a statement. “Senior executives and non-executives who have experience of leading businesses through the last financial crisis are in great demand.”

“We’re even seeing some positive changes, like executives being released from their gardening leave clauses earlier than they would normally. This allows them to get to their new employer quicker to help fight fires.”