Key Principles of Firing CEOs and Succession Planning

Across hundreds of conversations on Enter the Boardroom, Chairs and directors repeatedly reflected on CEO exits they wished they had handled differently.

Very few described firing a CEO as a single moment. Instead, they talked about long periods of hesitation, misdiagnosis and delay - often driven by loyalty, optimism or fear of disruption. By the time action was taken, the cost to the business, the board and the CEO was already far higher than it needed to be.

What follows are the principles our guests most consistently highlighted when discussing CEO removal and succession, and the mistakes boards make when they avoid confronting them early.

What this article reveals at a glance

1. Most CEO exits fail before the firing decision is made.
Boards often delay clarity - about expectations, milestones and consequences - which turns manageable performance issues into binary outcomes.

2. Popularity and effort distort judgment.
Several guests warned that boards confuse likeability and hard work with effectiveness, allowing underperformance to persist longer than it should.

3. Change is harder and slower than boards expect.
Leadership style, incentives and behaviour are deeply entrenched. Coaching has limits, and delay often reflects misplaced hope rather than realistic assessment.

4. Succession planning fails when it’s treated as episodic.
The strongest boards treat succession as continuous, rather than something to scramble for once a decision has already been made.

Taken together, these insights suggest that firing a CEO is rarely the hardest part. The hardest part is confronting reality early enough to preserve choice.

Key Principles 

Set underperforming CEOs milestones before you fire them

“With underperforming CEOs, you have to have milestones. 'In six months I need to see this thing being delivered.' And that can be a change of attitude or culture. The numbers are a different issue because they’re so obvious. But the key questions are, ‘does he or she get followership? Is the team going to be behind them when things get tough?’” Charles Allen, Baron Allen of Kensington, CBE, Chair of Moelis & Co, Balfour Beatty Plc, Global Media & Entertainment Group, and The Invictus Games

Don’t let a CEO’s popularity stop you from taking tough decisions

“The hardest calls boards have to make are people calls, particularly when a leader is struggling but still broadly liked. Loyalty and personal relationships often delay action, even when everyone in the room senses something isn’t working. The longer you wait, the harder that conversation becomes.” Dorothy Burwell, Partner at FGS Global, NED at Post Holdings, and Pennon plc

Even the best CEOs may have to go as the business scales

“Stephen had done what he did brilliantly, but he wasn’t able to put in place the boring, sustainable processes… that was going to be needed if all of the platform he was creating was to produce long-term value.” Sir Donald Brydon, Former / Chair of Tide Holdings, Adarga, PrimaryBid, Sage and London Stock Exchange Group 

Don’t underestimate how hard it is for people to change their leadership styles

"Changing people’s leadership styles is extremely difficult. People don’t really change their style of leadership. In one private equity fund, we ultimately had to persuade the managing partner to leave because he was prioritising his own interests over those of the investors. It required building a coalition of partners and LPs to bring that about."  Gerry Brown, Chair of NovaQuest Capital Management and G Brown Associates, co-author of Disaster in the Boardroom

"No amount of coaching and support would've changed the behavior. And it was about the behaviors. The learning there is to actually drill down and speak to a wider group, but also know when you need to influence to make the change." Cindy Rampersaud, NED at Sage Homes and formerly SID at Hipgnosis Songs Fund Ltd

Don’t fire a CEO if the issue is limited to their chemistry with the Chair

“It should not ever be that just you, as the chair, are finding it difficult to work with the chief exec … if the whole board can’t work with the chief executive … then you have to grasp that nettle.” Joanne Hindle, Chair of Stafford Railway Building Society and Shepherd’s Friendly Society, NED at Bank of London and Middle East 

Delaying firing decisions only makes things worse

“The management was extremely personable… but the board knew in its heart of hearts that they would have to make a change… taking too long was the mistake.” Sir Donald Brydon, Former / Chair of Tide Holdings, Adarga, PrimaryBid, Sage and London Stock Exchange Group 

“It takes 18 months to two years to pull together the coalition of the board — while shareholders and customers take it in the teeth.” Roger Martin, Professor Emeritus at Rotman School of Management, University of Toronto, best-selling author of over five management books, including Playing to Win 

Don’t confuse effort with impact

“Just working hard doesn’t mean things will work out.” Shellye Archambeau, Fortune 500 board director, strategic advisor, former CEO and author

Boards should apply the most pressure when things are going well, not badly

“Poor directors are supportive when things are going well and questioning when things go wrong. It should be the other way round.” Martin Gilbert, Co-founder and former CEO of Aberdeen Asset Management, Executive Chairman of River Global PLC, Chairman of Revolut and Toscafund

Lock in board consensus before firing a CEO

“We used to call it the death warrant… you get everybody to sign that they’ve agreed the chief executive has to go, so they can’t change their mind.” Sir Nigel Rudd, former/Chair of Pendragon plc, Pilkington, Invensys plc, Heathrow Airport, Business Growth Fund, Signature Aviation plc and Meggitt plc

Treat succession planning as a continuous process

“You get this very intense period where suddenly everyone focuses on succession. But for the rest of the time, there often isn’t enough sustained attention on it. That’s how boards end up exposed.” Angela Seymour-Jackson, Chair of PageGroup, Deputy Chair of Pikl, SID at Trustpilot Group, and NED at Future and Janus Henderson Group

“The biggest mistake is not starting succession early enough. Particularly when someone is doing a good job, people avoid the conversation. But the day you leave it too late, you’ve already failed as a chair.” Lord Charles Allen, Baron Allen of Kensington, CBE, Chair of Moelis & Co, Balfour Beatty Plc, Global Media & Entertainment Group, and The Invictus Games