HSBC hunts for new Chairman

HSBC has said that it is now hunting for a new Chairman as its present Chairman, Douglas Flint, reveals that he plans to leave in 2017. Flint believes his successor will lead the search for a new CEO to replace Stuart Gulliver. As we have previously reported, Flint and Gulliver have come under fire recently from investors upset over a series of multi-million pound fines, the $40m spent deciding to keep its headquarters in London and poor financial results. 

H SBC chairman Douglas Flint has announced that the start of the hunt for his successor has begun.

He also said that his successor would lead the search for a new chief executive to replace Stuart Gulliver.

Both men have been under fire from some investors after HSBC incurred a series of multi-million-pound fines over anti-money laundering measures and mortgage-backed securities mis-selling, spent £40 million deciding to keep its headquarters in London, and last month reported a plunge into the red in its fourth quarter.

Flint also warned of a “bumpier road ahead” with last month’s annual figures.

In a letter to shareholders ahead of next month’s annual meeting, he said: “The nomination committee has now turned its attention to formulating a succession plan for my own role as group chairman so that the incoming group chairman can lead the process for selecting the next group chief executive in due course.”

"They will have to appoint someone from outside the bank. There needs to be a break with the past."

He said the search process had begun, headed by Sam Laidlaw, chairman of the nomination committee, and senior independent non-executive director Rachel Lomax.

Flint said: “The board aims to nominate my successor during 2017, but the exact timing is clearly dependent upon identifying and securing the appropriate candidate. My own commitment is to remain as long as necessary to ensure a smooth transition.”

Ideally the bank wants to find Flint’s successor soon enough for them to take over at next year’s annual meeting.

Flint joined HSBC as finance director in 1995, and became chairman in 2010. Gulliver has been at the bank since 1980, and became chief executive in 2011. Flint was paid £2.5 million last year and Gulliver £7.3 million.

One senior banker said: “They will have to appoint someone from outside the bank at least to the role of chairman, if not chief executive too. There needs to be a break with the past.”

HSBC has hired headhunters, but declined to say who. In the past it has used Heidrick & Struggles and Anna Mann’s MWM Consulting.

One obvious candidate for the chairman’s role is Henri de Castries, chief executive of insurance giant Axa, who became a non-executive director of HSBC this month. Anyone chosen would have to be approved by regulators.

Nomura today downgraded HSBC from neutral to reduce, saying it faced “headwinds in a challenging macroeconomic environment”. But the shares rose 2p to 451.25p.