What is considered the least effective approach to CEO succession planning?

Prepare for the NACD Certification Exam with flashcards and multiple choice questions. Each question comes with hints and explanations to aid your understanding. Ensure you are fully ready for your test!

The least effective approach to CEO succession planning is turning attention to succession issues in the final year of the CEO's tenure. This method is often inadequate because it does not allow for sufficient time to identify and develop potential internal candidates, assess their readiness, or implement transitional processes that ensure a smooth change in leadership. Effective succession planning is a proactive and ongoing process that should begin early in a CEO's tenure. By postponing this planning until the final year, organizations risk facing a leadership vacuum, potential instability, and a lack of continuity, which can negatively impact company performance during the transition. Engaging in succession planning early enables the organization to cultivate talent, assess leadership capabilities, and build a pipeline of qualified candidates, fostering a more sustainable leadership transition.

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