The number of CEOs of not-for-profit senior living organizations who are likely to retire soon is on the verge of a rapid acceleration, suggests a recent Ziegler CFO HotlineSM survey, but not many of those organizations have transition strategies in place.
Looking at the top 15 LeadingAge Ziegler 100 senior living organizations, 10 have CEOs who will reach retirement eligibility within the next five years, says Ziegler.
Nearly 37% of survey respondents said their current CEOs had been with their organization for more than 15 years, while another 23% placed the tenure between 10 and 15 years.
“With tenure lengths this great, it is clear that many of these CEOs are looking to retire in the next 1-5 years and 5-10 years,” Ziegler writes. “These time frames are crucial periods for forming short-term and long-range strategic plans.”
Strong succession plans include tactics for emergency, interim, and long-term transitions, Ziegler notes, adding that more than 60% of the survey’s 139 respondents said they did not, in fact, have a formal written succession plan in place for the CEO position. The remaining 40% did have a plan in place.
“Many also noted that their plans included an emergency interim strategy only, which in many cases was an informal understanding to use the CFO in case of emergencies,” says Ziegler.
Succession planning, for the most part, only encompassed CEO positions. Nearly three-quarters (72%) had no succession plans for other key C-Suite positions, according to the survey, although many CFOs said those plans were “in development or early planning stages.”
Written by Alyssa Gerace