Beyond the Appointment: Communicate CEO Transitions for Long-Term Success

Board oversight of CEO transition announcements can help set the new executive up for success.

The pace of CEO transitions significantly increased in 2024, highlighting how boards are reconsidering their leadership needs to confront persistent uncertainty and lay the groundwork for sustainable, long-term growth. Notably, shareholder activism has emerged as a powerful catalyst for these changes, with S&P 500 CEO resignations linked to activist pressure tripling since 2020.

That momentum has carried into this year: January 2025 recorded one of the highest volumes of CEO exits on record. As geopolitical, economic, and societal forces continue to test executive resilience and adaptability, an elevated rate of turnover is likely to persist through the end of 2025 and into 2026.

Board members seeking to set incoming CEOs up for success should recognize that their responsibilities extend beyond finding the right person for the role. Director oversight of how the transition is communicated—and how stakeholders are engaged—can significantly shape perceptions and influence the new leader’s trajectory. 

While important decisions should involve the full board, oversight of the transition announcement and subsequent stakeholder engagement should belong to a small subset of directors, ideally including members of the nominating and governance committee. These designated individuals can use the information below to make sure they get the message right, effectively oversee the announcement and stakeholder engagement, and guide discussions with those executing the transition announcement.

Shape the narrative. While management and communications professionals will execute the announcement rollout, the board should set the tone and key messages. Communications, such as the press release detailing the leadership change, should provide a window into the board’s thinking and reflect a thoughtful, deliberate process. Messaging should emphasize why the appointee is fit for purpose given the company’s strategic priorities.

In most cases, the executive’s biography alone will not paint a compelling picture and should be complemented with other relevant experiences and accomplishments. Companies should also proactively address likely stakeholder concerns. For example, a chief financial officer that steps into the CEO role may invite questions about whether they are strictly a “numbers person” rather than a strategic leader. In this situation, highlighting the appointee’s experience in operations and strategic planning will help with appropriate positioning. 

Communicate the new CEO’s mandate to reduce uncertainty. Former Medtronic CEO Bill George, who served on the boards of Target Corp., ExxonMobil Corp., and the Goldman Sachs Group, cites the failure of boards to give incoming CEOs a clear mandate as one of the most common causes of failed transitions. In addition to clarifying the board’s expectations, a mandate, when shared with other stakeholders, can reduce the uncertainty that accompanies leadership transitions. Mandates may communicate whether the appointee is a transitional or transformational hire, for example, or that the board has charged them with improving profitability or pivoting to growth after a period of stabilization. This mandate should be included in the announcement press release and other communications. 

Prepare consistent responses to questions about the outgoing CEO’s exit. Boards can have valid reasons for giving limited details on the circumstances of an executive’s departure. Nonetheless, companies should prepare answers to the inevitable questions about the transition and confirm the consistency of messaging with board members and spokespeople and across communications materials and other disclosures. 

Mitigate anxiety about financial performance and other common concerns. CEO departures, especially when they appear abrupt, may raise investor concerns about undisclosed performance issues. Companies can preempt this by reiterating guidance or releasing earnings early in conjunction with the appointment announcement. The board should be actively involved in opining on and reviewing these statements to ensure they signal continued stability.   

Involve the right perspectives in the planning process. Boards should ensure that the team planning and executing the transition announcement is equipped to understand various stakeholders’ concerns and expectations. Third-party communications specialists who do this work routinely bring valuable insights. Additionally, members of the management team may provide critical intel about messaging and the mechanics of interacting with customers and employees, while investor relations professionals can give insight into shareholder concerns. Furthermore, the communications lead can advise on the company’s established practices and provide tactical input on how to execute the announcement. Boards should balance planning needs with the potential for leaks when bringing others into the transition process. 

Prioritize employees during the transition period. CEO transitions may cause uncertainty and fear among employees, hurting morale and productivity. This is especially true with external hires, where the incoming CEO is likely unknown to employees. Frequent and substantive employee communication through multiple channels that starts with the transition announcement and comes from the new CEO, chief human resource officer, or other executives, as appropriate, is the remedy. Providing employees with regular opportunities to hear directly from the CEO or to have direct dialogue through “listening tours” will help address concerns and secure buy-in from these critical stakeholders. 

Have a detailed plan for post-announcement introductions facilitated by directors where appropriate. Relationships with constituents, such as partners, shareholders, and clients, can determine whether a CEO succeeds or fails. Directors, along with members of management and the transition working group, should identify which relationships to prioritize and develop an engagement plan that includes objectives and methods of outreach. The plan should include introductory meetings with large shareholders during the CEO’s first weeks, accompanied by other members of management and one or two board members. In all meetings, the CEO’s primary objectives are to listen, gather perspectives, and start building relationships.  

Begin to prepare for the next earnings call. A CEO's first earnings call is a critical opportunity to start building credibility and set expectations with investors, analysts, employees, and other stakeholders. Directors should pay close attention to materials and messages to ensure they are consistent with the board’s vision and set the appropriate tone. 

Assess the benefits and risks of the new CEO doing media interviews. In certain circumstances, such as when a CEO change is part of a larger story (e.g., a major transformation) and the company wants to reinforce a new vision, participating in media interviews can advance the company’s goals. Companies and boards should also determine whether it makes sense to have the departing CEO participate to show continuity and build excitement for the future.    

As CEO turnover accelerates, boards must approach leadership transitions with a heightened sense of strategy, urgency, and nuance. The forces driving executive change—activist influence, shifting stakeholder expectations, and external volatility—are not abating. Choosing the right candidate is only the beginning: Thoughtful communications planning and tactics can build stakeholder confidence and position a new CEO for success.

As Michelle Edkins, managing director and global head of Active Investment Stewardship, said, “Deliberate and thoughtful planning for CEO succession is one of the board’s most important responsibilities.” Effective communication is inseparable from that responsibility.

The views expressed in this article are the authors’ own and do not represent the perspective of NACD.

Edelman is a NACD New Jersey chapter sponsor, providing directors with critical and timely information, and perspectives. Edelman is a financial supporter of the NACD New Jersey chapter.