HSBC Plans to Name Successor to Chairman Flint Next Yearby
Replacement to lead search for new chief executive officer
Douglas Flint has been executive chairman since 2010
HSBC Holdings Plc said it plans to nominate a successor next year for chairman Douglas Flint, who along with Chief Executive Officer Stuart Gulliver make up the longest-serving duo at the helm of a major European bank.
The search has started, though the exact timing will depend upon “identifying and securing the appropriate candidate,” and Flint will remain as long as necessary to “ensure a smooth transition,” the London-based company said in a notice of its annual general meeting. The next chairman will “lead the process for selecting the next group CEO in due course.”
HSBC has previously committed to appointing an external candidate from outside the bank, who would assume a non-executive rather than executive role. Scotland-born Flint, 60, joined as finance director of Europe’s largest bank in 1995 before being named executive chairman in 2010. Oxford-educated Gulliver, 57, started at HSBC in 1980 and excelled as a trader, rising through the ranks to become CEO in 2011.
The board’s senior independent director Rachel Lomax is leading the search for Flint’s replacement.
HSBC has been revamping its board after coming under pressure from shareholders unhappy about a slump in shares. The bank added Axa SA CEO Henri de Castries and former leader of Diageo Plc Paul Walsh as independent non-executive directors in November, replacing long-standing members of the board that are stepping down.
Deputy Chairman Simon Robertson, 75, and Rona Fairhead, the 54-year-old chair of the bank’s North American arm, are retiring at the bank’s annual meeting April 22. Safra Catz, co-CEO of software maker Oracle Corp., left at the end of last year.
Since 2011, Gulliver and Flint have announced more than 87,000 job cuts, exited more than 80 businesses and reduced the bank’s sprawling global footprint to 71 countries and territories from 88. Alongside most other European banks, the executives have been struggling to grow profitability faced with record-low interest rates, misconduct fines and rising compliance and regulatory costs. The shares have fallen 16 percent this year, following 12 percent and 8 percent drops in 2015 and 2014 respectively.
The pair weathered U.K. lawmakers’ criticism of their leadership last year after fresh details from files leaked in 2008 showed the bank helped drug cartels and arms dealers launder money on their watch, while advising customers on how to evade tax. HSBC made its first pretax quarterly loss under Gulliver and Flint in 2015 as profit from Asia dropped amid a slowdown in Chinese growth, forcing the pair to slow hiring and investment plans in the region.
Flint, a former KPMG accountant, completed the program for management development course at Harvard Business School in 1983 and prior to that attended Glasgow University, according to his biography on HSBC’s website.