Succession Planning In Indian Businesses: Why Boards Must Lead The Charge

The Quiet Risk No One's Talking About

India Inc. is at an inflection point. As businesses navigate digital disruption, rapidly evolving socio-economic and geopolitical dynamics, and growing ESG expectations, leadership capabilities are under intense scrutiny. Yet, one critical risk remains overlooked: the lack of structured, Board-driven succession planning.

Despite growing awareness, succession planning remains underdeveloped in Indian boardrooms. A recent Economic Times article, citing a survey report, revealed that only 17% of Indian companies place succession planning among their top strategic priorities. A separate Deloitte India study (2024) reinforces this concern: although 72% of Indian companies report having a succession framework, only 27% consider it effective.

What’s Holding Indian Companies Back?

Despite its importance, succession planning in India still encounters common barriers:

• ‍Promoter reluctance: Deep emotional investment can make it hard to let go.‍
• Board inertia: Boards may hesitate to challenge the status quo or lack insight into internal talent.‍
• Ad-hoc CXO hiring: Leadership gaps are often filled reactively.‍
• Disconnect from strategy: Succession is often treated as an HR issue, not a strategic imperative.

Bridging the Gap: Unlocking the Board’s Role

Succession planning isn’t just about identifying future leaders. It’s about ensuring leadership continuity, protecting organizational culture, and future-proofing the business. And this is where Boards can make a decisive impact.

While many Boards in India oversee CEO appointments, not many engage actively in broader leadership succession, especially beyond the C-suite. In Promoter-led businesses, Board involvement brings neutrality, governance discipline, and long-term perspective.

Questions Every Board Should Be Asking

• Is there a Board-approved succession plan for the top five leadership roles?
• Can the organization manage an unplanned CXO exit without disruption?
• Is the leadership pipeline aligned with the future business strategy?
• Are Promoters being guided by Boards into phased governance roles?
• Do succession plans incorporate cultural fit, diversity goals, and digital expertise?

How Boards Can Champion Succession Planning

Progressive Boards are taking ownership and driving change by:

• ‍Owning the succession agenda: Boards must treat succession as a governance priority, extending beyond the CEO to critical leadership roles.‍
• Engaging Promoters proactively: Boards can facilitate structured leadership transition dialogues, helping Promoters balance emotional legacy with long-term sustainability.‍
• Building succession pipelines: Boards should mandate identification of high-potential internal talent and benchmark externally for C-1 and C-2 roles, backed by robust development plans. ‍
• Leveraging external expertise: Engaging executive search and leadership advisory partners can help identify and onboard business-critical talent. These partners bring valuable market and talent insights, assess leadership potential and cultural fit and support transition roadmaps.

Case in Point: Enabling Leadership Transition in an Indian Manufacturing Firm

Recently, we partnered with the Board and the Promoter & Chairman of a leading Indian manufacturing company to manage a critical leadership transition. The incumbent Chief Executive Officer (CEO), a long-serving and trusted aide to the Promoter, was due to retire within a year. While the Promoter was initially inclined to extend his tenure, the Board raised important questions about whether this aligned with the company’s ambitious growth agenda.

At this stage, we engaged with the Chairman and the Board and advised them on the external market landscape, available leadership talent, and the capabilities needed to lead transformation at scale. Our insights helped them objectively arrive at a collective decision to initiate an external search for a suitable successor.

Following this, we collaborated closely to design a succession strategy tailored to the demands of rapid business expansion and long-term sustainability in a fast-evolving market and technological environment.

Key Concerns To Be Addressed:

• Could the successor build credibility without destabilizing operations?
• Could the new leader balance culture preservation with modernization and scale up?
• Would the successor bring fresh perspectives and technological expertise to drive innovation?
• Would the organization accept a successor from outside the Promoter’s inner circle?

Our Succession Advisory Approach:

• ‍Stakeholder alignment: We engaged with the Promoter, Board members, and HR leadership to align expectations on the future CEO role, respecting legacy while focusing on transformation.‍
• Market mapping and talent sourcing: We conducted intensive research and leveraged industry networks to identify high-calibre candidates with strong sector expertise, proven transformation experience, and digital acumen.‍
• Assessment & culture fit: Beyond technical, commercial, and business leadership skills, our holistic assessment ensured the CEO embodied the company’s values while driving fresh ideas.‍
• Structured transition: We facilitated a seamless handover with a planned overlap, helping the new CEO to build trust with internal teams.

The Successful Outcomes:

• A next-generation CEO was appointed – digitally savvy, operationally strong, and culturally aligned.
• The Promoter began transitioning away from operational involvement to focus more on long-term strategic priorities.
• The Board institutionalized a succession planning framework to groom future leaders beyond just the CEO.

This case highlights how effective succession planning can blend legacy preservation with strategic transformation, preparing the business for sustainable future growth.

Succession – ‘A Catalyst for Transformation’

Boards that champion succession planning don’t just avoid leadership vacuums – they enable transformation!

Whether you are navigating a ‘Promoter-to-Professional’ transition or building leadership depth for growth, the time to act is now! Succession isn’t just about choosing the next leader; it is about shaping the next chapter of your organization.

Let’s Talk Succession

We partner with Boards, Promoters, CEOs/MDs, and CHROs to design bespoke succession strategies that blend cultural continuity with future-ready leadership.

If you are ready to move succession planning from intent to impact – let’s connect.

Contact MANISH VARGHESE, Managing Director, India and Middle East.