And herein lies the problem with governance in listed public...

And herein lies the problem with governance in listed public companies here and elsewhere. It’s so easily muddied. When the roles of CEO (employee of the board) and MD (director of the board) are effectively one, the MD as a director becomes a key influencer on the selection & appointment of a new company chairman in situations like this. No slight intended on Simon Hay specifically of course, but really no CEO function should ever be in a position to influence the selection of their effective “boss”.

And in practice they are - because its the chairman (regardless of whether they are exec or non-exec) who holds expanded authority to act for and on behalf of the full board to which the CEO function directly reports, and he/she is usually the first person the CEO turns to for guidance, review, strategy or approvals & decisions that are above established thresholds.

Yes, director (and by virtue, new chairman) appointments are technically by vote of shareholders but again, in practice, it’s a retrospective rubberstamping sought via an often unremarkable vote at a future annual meeting. Rarely do you see directors offered up by shareholders unless it’s a big fish activist holder. Unless the new person (who by then has often acted in that capacity for a reasonable period of time) is highly controversial, it barely registers. This sort of increasingly insular process is the reason why imo so many companies cannot get their act together with governance, why things often go awry at the top in times of trouble and when it comes to checks & balances that might look good on paper in a policy document & by committee but rarely works to the benefit of owners (shareholders) in practice. There will be many times in the ordinary course of business where the board and the holder of the CEO function might diverge completely on opinion or strategy. If that person is MD as well, and the chairman is exec, then what gives. Having chairpersons that in large (or even small) part originally owe their position to an employee’s influence is never much good.

Again, I’m not casting aspersions on Simon Hay, just commenting broadly about how governance processes are nowhere near as effective in public companies as shareholders are led to believe. We will see the same issues emerge shortly at FFX with replacements of both the chairman and CEO function there. IMO there should be a more transparent process and much better regulated framework on how/when and by whom public company directors are appointed and a clearer demarcation of accountabilities of officers i.e. employees vs directors, exec vs non exec, etc. “Appointing themselves” (often into combined functional roles) has left a trail of corporate destruction in the past. We will naturally be the exception (...until we’re not!).