Tuesday, July 19, 2011, 04:05 pm
WSJ: Apple board members have informally explored CEO succession optionsMembers of Apple's executive board have reportedly discussed succession plans with outside consultants in the event that Steve Jobs can no longer run the company, though Jobs himself has characterized details in a new report from The Wall Street Journal as "hogwash."
Citing "people familiar with the matter," the Journal reported on Tuesday that members of Apple's board discussed CEO succession options with executive recruiters. They are also alleged to have spoke with the head of one high-profile technology company.
"The conversations weren't explicitly aimed at recruiting a new chief executive and were more of an informal exploration of the company's options, said these people," the report said. "The directors don't appear to have been acting on behalf of the full board, some of these people said. Apple has seven directors, including Mr. Jobs."
The authors said they reached out to Jobs in an e-mail on Monday with a series of questions. The chief executive reportedly responded with: "I think it's hogwash."
The alleged discussions on the part of board members are said to have taken place after the company announced earlier this year that Jobs would take another medical leave of absence from the company. Three people reportedly said that "a couple" of Apple's directors held talks about the company's leadership after they were informally approached by recruiters with search firms.
"Apple's directors have made no decision about whether to retain executive recruiters, these people said. Some of the people who talked with Apple directors said they considered the conversations to be more than the routine discussions that they typically have with board members."
A person who anonymously spoke with the newspaper revealed that Apple's independent board members have discussed succession in private sessions without Jobs for the last 12 years. They said investors will only learn of Jobs' successor when he decides to retire or if the board ousts him. They also reportedly acknowledged that any departure of Jobs "is going to be traumatic" for the company.
Chief Operating Officer Tim Cook is labeled as a "leading candidate" for the CEO role should Jobs leave, though it was said that Apple's directors have a list of criteria they would like to have in the company's next chief executive.
Though Jobs has relinquished his day-to-day CEO obligations to Cook, he has still made numerous appearances since his departure in January. In early June, he led the keynote at Apple's annual Worldwide Developers Conference, and that same week he pitched a plan for a new 12,000-employee "spaceship" campus to the Cupertino, Calif., City Council.
Apple has been publicly called out on a number of occasions to disclose its succession plan to investors. Apple has countered that disclosing the secret "comprehensive succession plan" publicly would "undermine efforts to recruit and retain executives."
One survey conducted in February found that just 35 percent of companies -- including Apple -- have drafted a formal CEO succession plan. That's in spite of the fact that 98 percent of executives polled by Korn/Ferry International believe a CEO succession plan is an important part of corporate governance.
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