Findings reveal bank leaders' views on succession planning, executive talent challenges and rising compensation costs.
NASHVILLE, Tenn., June 18, 2024 /PRNewswire/ -- Bank Director, the leading information resource for directors and officers of financial institutions nationwide, released the results from its 2024 Compensation & Talent Survey, sponsored by Chartwell Partners. Survey findings reveal that many bank boards lack proactiveness in CEO succession, which could have costly consequences.
The board's role in identifying potential successors and implementing a plan of action is pivotal in succession planning for the CEO. However, according to the survey, many respondents stated they have less confidence in their long-term succession plans for their CEO, with only 18% having identified a CEO succession candidate as well as a timeline and plan of action. With almost half saying they expect their CEO to depart or retire within the next five years, many boards may find themselves in a tough position over time.
"Top performing boards recognize their responsibility to own the CEO succession plan and not fully delegate to the current CEO," says J. Scott Petty, managing partner at Chartwell. "The lack of a thorough evaluation process can lead to a less-than-qualified internal choice, creating unnecessary leadership risk."
This lack of clarity and strategy regarding who will be leading the bank in the longer term continues to be a growing concern among survey respondents, along with rising compensation costs and executive talent challenges.
"Selecting the bank's next CEO is a vital board responsibility," says Emily McCormick, Bank Director's vice president of editorial & research. "It's a decision that can help ensure the long-term health and continued independence of an institution, and the achievement of its strategic goals."
A large majority (84%) of survey respondents say they believe the talent level of their executive team is strong enough to achieve their bank's financial and strategic goals over the next five years, even though many of those ostensibly expect their CEO to leave or retire in that time frame.
To view more key findings from the 2024 Compensation & Talent Survey, click here or visit BankDirector.com.
The survey includes the views of 289 independent directors, CEOs, HROs and other senior executives of U.S. banks below $100 billion in assets. Compensation data for directors, non-executive chairs and CEOs was also collected from the proxy statements of 102 publicly traded banks. Full survey results are now available online at BankDirector.com.
About Bank Director
Bank Director reaches the leaders of the institutions that comprise America's banking industry. Since 1991, Bank Director has provided board-level research, peer insights and in-depth executive and board services. Built for banks, Bank Director extends into and beyond the boardroom by providing timely and relevant information through Bank Director magazine, board training services and the financial industry's premier event, Acquire or Be Acquired. For more information, please visit www.BankDirector.com.
About Chartwell Partners
Chartwell Partners is a national retained Executive Search and Leadership Advisory firm known for helping clients professionally manage a board director or senior leadership decision process in a high-touch professional manner. The Financial Services Practice, led by Scott Petty, conducts board director, CEO and senior management assignments, and board and succession advisory engagements for financial institutions across the U.S. www.chartwellpartners.com
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For more information, please contact Bank Director's Director of Marketing, Deahna Welcher, at [email protected].
SOURCE Bank Director
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