Interim CEO

An interim CEO runs the company for a defined period while a longer-term decision is made or a transition is completed. The person may be a senior executive already in the business, a board member who steps in, or an outside executive hired for the purpose.

Family businesses typically appoint one in three situations:

• A sudden departure: the founder or CEO dies, falls ill or leaves unexpectedly, often as set out in an emergency succession plan.
• A bridge: the family successor is chosen but needs more time and experience, and a non-family leader runs the business in between.
• A reset: the company needs a turnaround or restructuring before the next generation takes over.

Interim CEO or successor?

An interim CEO is, by definition, temporary. The successor is the person expected to lead in the long term. Problems arise when this is unclear. An interim leader who is never told how long they will stay may start acting as permanent, or the senior team may begin to see them that way. Clear terms, agreed with the board of directors, protect everyone, including the interim leader. Families should involve their lawyer in the employment terms.

Why it matters for the successor

A bridge period can be a real advantage for a family successor. It gives time to gain experience, lead a division and build relationships without carrying the top job too early. But it has a cost: when the interim leader steps aside, the successor has to establish authority with a senior team that has grown used to someone else. That transition needs as much preparation as a handover from the founder. Interim CEO before the family successor looks at how to make the bridge work.