The strength of any organization lies not only in its strategies or market position but in the people who steer its course. As business challenges grow more complex, the question of who leads next can no longer be left to chance. A clear plan for leadership change is essential. Without it, companies risk disruption, instability, and loss of stakeholder confidence. Preparing future leaders is not just about continuity it reflects a company’s seriousness about its purpose and future.

Now more than ever, effective governance of executive succession planning is not just a boardroom concern; it is a critical business imperative. Talent risk at the top refers to the exposure organizations face when key executive positions, particularly at the C-suite level, become vacant or compromised without a clear and actionable succession plan in place.

This risk manifests not only when leaders exit unexpectedly due to resignation, illness, or scandal, but also when their eventual departure has not been anticipated with adequate foresight. The absence of a capable successor can lead to strategic paralysis, organizational uncertainty, plummeting investor confidence, and a disruption in business continuity.

What makes this risk even more significant is its often-underestimated nature. Boards and top management sometimes delay succession planning because of discomfort with discussing leadership change or overconfidence in current stability. However, governance best practice dictates that succession planning should not be a reactive process initiated only when an executive is on the verge of departure.

It should instead be embedded in the strategic governance agenda, treated as an ongoing process guided by long-term vision and readiness for change. Governance plays a fundamental role in reducing talent risk. Through strong oversight and structure, it ensures that succession planning is not arbitrary but deliberate, documented, and aligned with the organization’s objectives.

The Board of Directors, and more specifically the Nomination and Governance Committee, has a fiduciary duty to champion leadership continuity by creating transparent frameworks and policies. These should define how potential successors are identified, assessed, mentored, and, when necessary, appointed.

The board must not simply rubber-stamp decisions made by the CEO or HR; it must actively shape and evaluate the organization’s succession strategy. Executive succession planning has emerged as a pressing governance priority in today’s corporate landscape. With increasing CEO turnover, demographic shifts, and the need for leadership continuity, boards across the world are being compelled to confront the growing talent risk at the top.

The report on “Executive Succession Planning between (2024–2025)” offers a concise yet powerful snapshot of the current state of executive succession governance from multiple reputable sources to highlight both global progress and regional shortcomings.

Chart 1: Report on succession plan

The report above reveals key insight on executive succession plan. According to the joint survey from Diligent Institute and FTI Consulting (2025), thirty three (33%) of directors from U.S. companies now prioritize succession planning as a key board agenda item.

Similarly, the Russell Reynolds Associates Global CEO Turnover Index (2025) reports a record 73% of new CEOs being promoted internally which implies that organizations are not only acknowledging the importance of succession planning but are also embedding it into their leadership development pipelines.

Furthermore the Russell Reynolds report shows that planned CEO successions accounted for 22% of CEO departures in 2024, representing a 13% year-over-year increase. This evolution away from reactive and often turbulent leadership changes towards deliberate and timely successions demonstrates the positive impact of structured succession planning.

These figures reflect the influence of governance advisory firms like N2Growth, which emphasize the need for boards to define leadership competencies, collaborate with HR, and institutionalize succession as a core governance function. However, while organizations globally are making strides, the story in Africa and particularly Nigeria is more concerning.

The PwC Africa Family Business Survey reveal that 61% of African family businesses lack formal succession plans, and only 15% have documented CEO succession processes. In Nigeria most especially the situation is even more stark with less than 20% of listed companies having board-approved succession frameworks or plan.

 This points to a significant governance gap which reveals the fact that many Nigerian firms are prone to leadership vulnerabilities and operational disruptions in the event of unexpected executive departures.

The report visualizes this disparity clearly. While international firms demonstrate proactive internal succession and rising planned transitions, Nigeria lags behind. This findings reveals the fact that there is urgent need for Nigerian corporate boards to adopt strategic succession frameworks that align with global best practices.  

An effective succession governance framework begins with proactive planning. This means companies must maintain an updated understanding of leadership needs both present and future. As strategic goals evolve, so must the leadership profiles required to execute them. For instance, an organization embarking on a digital transformation will require different leadership competencies than one focused on geographical expansion or consolidation.

Therefore, succession planning must be closely tied to business strategy, ensuring that future leaders are selected not just for their current capabilities but for their potential to lead in the organization’s next chapter.

Furthermore, the identification and development of internal talent should be prioritized. While external recruitment has its place, a strong pipeline of internal candidates demonstrates a commitment to growth, stability, and institutional knowledge. Internal candidates, when properly prepared, understand the culture, values, and dynamics of the company, making for smoother transitions.

However, readiness should not be assumed; it must be assessed through performance evaluations, leadership assessments, and exposure to cross-functional roles. Governance requires boards to critically appraise not only the technical proficiency of candidates but also their emotional intelligence, resilience, and alignment with organizational values.

Diversity is another cornerstone of responsible succession governance. Boards must move beyond traditional and often narrow selection criteria and embrace inclusion as a strategic advantage. Gender, ethnic, generational, and experiential diversity enrich leadership thinking and enable organizations to better respond to a broad range of stakeholders and market conditions.

Succession pipelines that overlook diversity risk replicating systemic blind spots and missing out on the innovation that diverse teams foster. A key challenge in succession planning is balancing transparency with confidentiality. Stakeholders, including employees and investors, seek assurance that leadership continuity is under control.

Yet, too much openness can fuel internal competition or speculation. Good governance requires a carefully managed communication strategy one that provides necessary clarity without jeopardizing internal morale or creating instability. Boards must define what information is shared, when it is shared, and how transitions are announced and managed.

Despite the importance of these practices, many organizations still fall into common traps. These include relying too heavily on charismatic leaders without grooming successors, failing to document succession procedures, or treating the process as a compliance task rather than a strategic endeavor. Perhaps most dangerously, boards sometimes disengage from the process, assuming it is the sole responsibility of management.

This detachment can lead to uncoordinated decision-making and, in crisis situations, hurried appointments that are ill-suited to the challenges at hand. To avoid such pitfalls, organizations must adopt a culture where succession planning is continuous and data-informed. Regular talent reviews, scenario planning for unexpected transitions, and leadership development programs must all be part of the board’s strategic oversight.

Additionally, engaging external consultants or leadership advisors can provide objectivity and benchmark insight, particularly in industries where leadership standards evolve rapidly. Executive succession planning is no longer a back-burner issue, it is a core responsibility of forward-thinking leadership.

In Nigeria, where corporate continuity and governance gaps remain pressing concerns, the lack of documented succession processes signals a vulnerability that must be addressed urgently. Leadership transitions, if poorly managed, can destabilize performance, weaken stakeholder confidence, and disrupt strategic momentum.

However, when succession is planned with clarity, transparency, and long-term vision, it fosters continuity, strengthens organizational culture, and signals maturity to investors and partners. The future belongs to organizations that treat leadership succession not as a reactive process, but as a proactive strategy. The choice is simple prepare for tomorrow’s leadership today, or risk being unprepared when it matters most.

Research & Advocacy Department,