Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman and chief executive officer Morris Chang (張忠謀) yesterday said no timetable had been set to relinquish his CEO post, aiming to end speculation that the world’s top contract chipmaker would select Chang’s successor in the next 18 months.
The speculation emerged following the chipmaker’s unexpected announcement of a managerial restructuring plan on Friday that entails promoting three vice presidents to share the position of executive vice president and as the company’s cooperation officers, an unconventional approach to seeking a new CEO.
“The prelude [to pick a successor] has not yet started,” Chang told a media briefing at the company’s Hsinchu headquarters. “It is too early to say ... But, at the moment, my view is that the likelihood of having two or three co-CEOs will be higher than just having one, based on TSMC’s business [scale].”
Photo: CNA
In June 2009, Chang has said he expected to stay at the CEO position for between three and five years.
“In principle, I still maintain that thought ... But, the five-year [maximum] can be reviewed, too,” he said.
Chang said that when the time was ripe, or when the change in strategy he launched in 2009 bore fruit, he would hand over the CEO post.
TSMC shares edged 0.5 percent lower yesterday, falling for the fourth consecutive session, to NT$78.9, compared with the TAIEX’s 1.35 percent decline.
“The plan allows some flexibility. TSMC is building in some flexibility in its leadership as it tackles the challenging task of eventually replacing a strong leader that has built the organization into a well-regarded industry leader,” Credit Suisse analyst Randy Abrams said in a report released yesterday.
Less than three years ago, Chang resumed his CEO post and decided to boost the company’s research and development efforts and to greatly expand capital spending to fend off intensifying competition.
Chang also worked hard to keep prices within an acceptable range and maintain structural profits.
“We are starting to see some effect now. This is just a start. I anticipate the effect to be bigger next year and the year after,” Chang said.
The most advanced 28 nanometer chips will account for 10 percent of TSMC’s total revenue this year and the figure will increase significantly next year, Chang said. And next year, TSMC should start ramping up production of next-generation 20 nanometer chips, he said.
“We believe capacity is well booked out now on 28 nanometer and could even prompt an upward bias to capex through the year,” Abrams said.
Chang said he would not step down as company chairman and that he would continue to be involved in the company’s policymaking.
He emphasized that he was in good health amid speculation that the sudden management shakeup was because he was having health problems.
Starting yesterday, research and development head Chiang Shang-yi (蔣尚義), factory operations head Mark Liu (劉德音) and C.C. Wei (魏哲家), head of TSMC’s marketing and business planning department, are to take turns overseeing the business for six months.
The rotation plan aims to train those three candidates in developing business strategies together, Chang said.
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