Old age should not be a barrier to success in a fair and modern society. A person’s ability should determine their career progress, not assumptions made because of their background. Indeed, diversity of experience, just like diversity of gender or ethnicity, can be hugely beneficial in creating an organisation resilient to the challenges a diverse and changing world can throw at it.
A nice thought, eh. So is it okay for a multibillion dollar listed company to have a 92-year-old executive chairman? That’s what US media firms Viacom and CBS had, in the form of Sumner Redstone – at least until the tycoon and majority owner announced his retirement from CBS on February 3, leaving his position at Viacom uncertain.
Redstone’s tale is a tragic one – a relentless mogul who regularly insisted he has ‘no intention of dying’, his latter years have been marked by high-profile divorces, feuds with his children and lately allegations of mental incapacity from his former carer (and lover) Manuela Herzer, who called him ‘a living ghost’. That’s all very Dallas or Dynasty, but it’s also instructive on the thorny issue of succession planning.
The problem with staying at the top of a business for too long is that instead of suppressing power struggles in the boardroom, it actively encourages it. Think about Stalin. As the elderly Soviet dictator’s health failed, his terrified subordinates began waging a life or death (literally) war with each other for who would control the country after he died. The fact that it was fought in secret did nothing to take away from how vicious it was (just ask the very dead KGB chief Lavrentiy Beria).
Stalin was only in power for 30 years. Redstone has ruled CBS and Viacom’s parent company National Amusements for nearly 50. Sure enough, the fight to control the company after he’s gone is already shaping up nicely. His daughter Shari has ensured an easy coronation for CBS’s former chief executive Leslie Moonves, but has stated her public opposition to that of her father’s trusted lieutenant Philippe Dauman at Viacom, which owns MTV, Paramount and publisher Simon & Schuster.
What is the consequence of such power struggles? Though the senior leadership at Redstone’s companies may indeed be perfectly competent and harmonious, the presence of an all-powerful patriarch will generally tend to produce a structure riddled with entrenched factions jostling for control once said patriarch finally goes. What follows is surely a distraction from running a business effectively – managers are supposed to work on improving the operation of the firm, not scoring points with the boss.
To repeat – this is not to say that CBS or Viacom have had these problems, just that they are far more likely to develop in companies controlled by an unchallengeable figure who’s been at the helm for decades than in those with a more conventional turnover of chairmen. And while a few 90-year-olds could well have the vigour and alacrity to oversee a big business, it’s probably best for their firms if they let go before it’s too late.
Succession planning isn’t just an issue for ageing tycoons. Click here for a few top tips from MT’s archive on how to ensure a smooth handover.