The same-day deaths of two aging chief executive officers — industry icons in railroading and banking — show why some investors and governance experts want companies to disclose more about succession plans and the health of their executives.
CSX Corp’s Hunter Harrison, 73, died on Saturday, one day after news of his medical leave pushed the railroad’s shares down the most in six years.
M&T Bank Corp said Robert Wilmers passed away “suddenly and unexpectedly” at age 83 — just months after the death of his own heir apparent.
The deaths underscore the privacy, governance and legal issues entangled in one fact of shifting demographics: As the US population ages, so do the corporate chieftains.
The average age of a chief executive has risen 4 percent in the past decade and there has been at least one health-related change atop Standard & Poor’s 500 Index companies in each of the past three years, executive recruiter Spencer Stuart said.
“What we’re facing is the new paradigm of work,” said Davia Temin, head of the New York-based crisis-management firm Temin & Co. “When people are in the zone of what they love to do, most of them are not going to voluntarily give that up. That means that people will work later and maybe with a little bit more of an illusion that death won’t apply to them.”
Companies might be forced to act as that illusion fades.
Even with the deaths of Wilmer and Harrison, data compiled by Bloomberg shows there are still 50 chief executives in the S&P 500 who are 65 or older. Nineteen of those exceed age 70 and three are older than 80.
Because death is unpredictable, succession is increasingly important, Temin said.
First a company has to have a clear communication plan for all contingencies, including illness and death, and have a plan for the next chief executive in place that is at the very least “almost ready now,” she said.
One difficult area with chief executive health disclosures is that they do not always share all the information they have with their companies, former US Securities and Exchange Commission (SEC) chairman Harvey Pitt said.
Key executives should sign waivers when they are hired by public companies that would allow disclosure of health issues at the board’s discretion, said Allan Horwich, a partner at Schiff Hardin and a Northwestern University law professor.
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
STILL UNCLEAR: Several aspects of the policy still need to be clarified, such as whether the exemptions would expand to related products, PwC Taiwan warned The TAIEX surged yesterday, led by gains in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US President Donald Trump announced a sweeping 100 percent tariff on imported semiconductors — while exempting companies operating or building plants in the US, which includes TSMC. The benchmark index jumped 556.41 points, or 2.37 percent, to close at 24,003.77, breaching the 24,000-point level and hitting its highest close this year, Taiwan Stock Exchange (TWSE) data showed. TSMC rose NT$55, or 4.89 percent, to close at a record NT$1,180, as the company is already investing heavily in a multibillion-dollar plant in Arizona that led investors to assume
AI: Softbank’s stake increases in Nvidia and TSMC reflect Masayoshi Son’s effort to gain a foothold in key nodes of the AI value chain, from chip design to data infrastructure Softbank Group Corp is building up stakes in Nvidia Corp and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the latest reflection of founder Masayoshi Son’s focus on the tools and hardware underpinning artificial intelligence (AI). The Japanese technology investor raised its stake in Nvidia to about US$3 billion by the end of March, up from US$1 billion in the prior quarter, regulatory filings showed. It bought about US$330 million worth of TSMC shares and US$170 million in Oracle Corp, they showed. Softbank’s signature Vision Fund has also monetized almost US$2 billion of public and private assets in the first half of this year,
RSS