JOH Partners examined sixty GCC family-controlled listed companies in research published in January 2026. Forty-seven of them, almost four in five, expect a succession event at chief executive or chair level within five years. Fourteen have a documented internal successor whose name the board could give, with the candidate aware of it.
That gap between having a plan and having a name is the whole subject. And it is wider at chair level than at chief executive level, because CEO succession at least gets discussed. Chair succession tends to be the conversation nobody wants to open, since the person who would normally chair it is the person being replaced.
The GCC BDI Board Effectiveness Review 2025 puts the regional baseline at 67 percent of boards with no formal succession plan at all. In at least one GCC market, that is no longer only a practice gap. It is a compliance gap, and it sits with the nomination and remuneration committee.
Is chair succession planning actually a regulatory requirement in the GCC?
In Oman, for listed companies, yes. The Code of Corporate Governance for Public Listed Companies sets out the competences of the nomination and remuneration committee under its Eleventh Principle, and the list includes an instruction that is unusually direct: develop a succession policy or plan for the board, or at least the chairperson. Two other items on the same list matter for the same reason. The committee must prepare detailed job descriptions of the role and responsibilities of directors including the chairperson, and it must look for and nominate qualified persons to act as interim directors where a seat becomes vacant. Read together, those three provisions describe a functioning chair succession framework: a written role specification, a documented plan, and an interim arrangement for an unplanned vacancy.
Elsewhere in the region the requirement is less explicit but the direction is consistent, and it runs alongside the wider push on board composition and renewal. Saudi Arabia’s Corporate Governance Regulations require Main Market listed companies to maintain a nomination committee or a combined committee of at least three non-executive members with a majority independent, and place board composition and succession squarely within its mandate. Oman’s Principles of Corporate Governance for Closed Joint Stock Companies, issued under Ministerial Decision 5/2025, extend nomination and remuneration committee requirements to closed companies and require the chair and vice-chair seats to be separate from the chief executive. The regulatory floor keeps rising, and chair succession is inside it.
Why do boards defer the chair succession conversation?
Four reasons, and only one of them is about governance.
1. The conflict problem. The chair normally sets the agenda and runs the meeting. Asking the chair to chair a discussion about their own replacement is structurally awkward, so the item never reaches the agenda.
2. The signalling problem. Directors read a succession discussion as a judgement on the incumbent’s performance rather than as routine planning, which makes raising it feel like an act of disloyalty.
3. The assumption problem. Many GCC boards assume the vice-chair or the longest-serving director will step up. That is a sequence, not a plan, and it has never been tested against what the role actually requires.
4. The genuine difficulty. Chairing is a distinct skill from directing. A board may have ten capable directors and no one who has demonstrated the ability to run a room, manage a dominant shareholder, handle a difficult chief executive and hold a board together through a disagreement.
Only the fourth is a real governance problem, and it is the one a plan can actually solve, given time. The first three are reasons for delay dressed up as reasons for caution, and they are the same dynamics that make CEO succession the decision GCC boards most often defer.
What should a chair succession plan contain?
Six components. A plan missing any of them is a statement of intent rather than a plan.
A written chair role specification
Separate from the generic director role description, and specific to this company at this stage, which starts with clarity on what a chair is actually for. Oman’s code requires this explicitly, and it is useful everywhere because it forces a board to state what it actually needs: capital markets credibility, family legitimacy, regulatory standing, sector depth, or the ability to hold a founder to account.
An emergency protocol
Who chairs the next meeting if the chair is unavailable tomorrow, who informs the regulator and the market, and how long the interim arrangement can run before a permanent decision is required. This should be a single page the corporate secretary can act on without convening anyone.
A named internal candidate pool with development plans
Not a ranking, a pool. Two or three directors who could credibly chair, each with a specific development gap identified and a plan to close it. A director who has never chaired a committee is not ready to chair a board, and committee chairmanship is the obvious training ground.
A live external option
Boards that only look internally end up appointing the least unsuitable insider. Maintaining an external market view, even without an active search, keeps the internal bar honest.
A timeline tied to the board’s own cycle
Chair terms, director terms and the strategic plan should be mapped against each other so a transition is not scheduled into the middle of a listing, a refinancing or a generational handover.
A documented review point
Annually, with the output minuted. An undocumented plan is indistinguishable from no plan at the moment a regulator, an investor or a court asks.
Who runs the process if the chair cannot?
This is the structural question that decides whether the rest of it works. Three models function in practice, and the choice depends on the board’s composition rather than on preference.
Model | How it works | Best suited to |
|---|---|---|
NRC-led | The nomination and remuneration committee owns the process under its standing mandate, reporting to the full board without the chair present for the relevant item | Listed companies where the committee is independent-majority and genuinely functioning |
Senior independent director-led | A designated independent director runs the process on the board’s authority and acts as the channel for director and shareholder views | Boards with a family or executive chair, where independence has to come from elsewhere |
Vice-chair-led with independent oversight | The vice-chair runs the process with an independent director or external adviser providing challenge | Companies where the vice-chair is not a candidate, which needs to be established first |
JOH Partners found the same structural answer in its interview programme: the succession process is genuinely difficult to run from inside the family, and the non-family chair or senior independent director is the mechanism that makes it possible. The research also identified the timing that works, which is appointing that independent figure two to three years before the expected transition, giving them time to build the family relationships and operating credibility the role requires. Boards without any of these three roles filled have a sequencing problem before they have a succession problem, and it is the kind of gap a properly scoped board evaluation surfaces immediately.
How does chair succession differ from CEO succession?
Materially, and conflating the two is a common error. CEO succession is an appointment the board makes about management. Chair succession is an appointment the board makes about itself, which removes the natural separation between decision-maker and subject.
Dimension | CEO succession | Chair succession |
|---|---|---|
Who decides | The board, on NRC recommendation | The board, about one of its own members |
Primary criteria | Operating capability against strategy | Ability to lead a board, manage shareholders and hold management to account |
Candidate pool | Internal executives plus external market | Sitting directors, plus external appointment to the board first |
Lead time | 12 to 24 months typical | 24 to 36 months, because a new director needs board tenure before chairing |
Visible trigger | Contract end, retirement, performance | Term expiry, age or tenure limits, or nothing at all |
Failure mode | Interim appointment while a search runs | Default to the vice-chair or longest-serving director |
The lead time is the row that matters most. If the plan involves recruiting a future chair from outside, that person needs to join the board as a director first and serve long enough to earn the room’s confidence. A board starting that process when the chair announces a departure is already two years late, which is why the sequencing belongs in the annual governance calendar rather than in someone’s intentions.
What happens when a chair transition is forced?
The GCC has been quietly building the machinery for exactly this. Saudi Arabia’s amended Implementing Regulation of the Companies Law for Listed Joint Stock Companies, approved by Capital Market Authority Resolution No. 2026-44-3 and published in Umm Al-Qura on 3 July 2026, codifies for the first time a detailed procedure for removing board members by ordinary general assembly.
This matters for succession because a forced exit compresses the timeline that considered board composition depends on. The mechanics are worth knowing before they are needed. Shareholders holding at least 10 percent of voting shares may request a removal. A request targeting the whole board cannot be made until six months have elapsed since the start of the board’s term. A request targeting individual directors must substantiate inability to perform duties, with grounds including absence from three consecutive or five non-consecutive board meetings, or conviction for a crime involving breach of trust. Where removal would take the board below quorum, the resolution must state that removal takes effect only once a replacement has been elected, and the board must convene a general assembly for that purpose within 75 days. A removed or resigned director cannot be re-nominated to the same board until the end of that term. A board with no chair succession plan and 75 days to elect a replacement is not making a considered appointment. It is managing an incident, and the market can see the difference.
What should a board do in the next quarter?
1. Put chair succession on the agenda as a standing item, and record it as such in the minutes so it cannot quietly disappear.
2. Ask who would chair the next meeting if the chair were unavailable, and confirm the answer is written down somewhere the corporate secretary can find.
3. Commission a written chair role specification from the nomination committee, reviewed against the strategy rather than against the incumbent.
4. Identify the two or three internal candidates and name the development gap for each, then give the most plausible one a committee chairmanship.
5. Decide who runs the process, and if the answer is nobody, appoint a senior independent director.
6. Map chair and director terms against the strategic plan and the listing or transaction pipeline.
7. Review the whole framework annually, and minute the review.
The GCC BDI data shows 78 percent of directors reporting improved board effectiveness over two years alongside that 67 percent with no formal succession plan. Both can be true: boards have got better at the visible parts of governance and have not yet addressed the part that only becomes visible when it fails. Chair succession is the clearest example, and it is the one where strong governance returns are most obvious in hindsight and most easily deferred in advance. Every chair leaves. The only variable a board controls is whether it chose the successor or inherited one.
Frequently asked questions
Who is responsible for chair succession planning?
The nomination and remuneration committee, reporting to the full board. Oman’s Code of Corporate Governance for Public Listed Companies requires the committee to develop a succession policy or plan for the board or at least the chairperson. Where the chair is a family member or the committee is not independent, a senior independent director should run the process on the board’s authority.
How far in advance should a board plan chair succession?
Twenty-four to thirty-six months for a planned transition, longer than for a chief executive, because a chair recruited externally must first join the board as a director and serve long enough to earn the board’s confidence. JOH Partners research suggests appointing the independent figure who will run the process two to three years before the expected event.
What should a chair succession plan include?
A written chair role specification separate from the generic director description, an emergency protocol covering who chairs the next meeting and who notifies the regulator, a named pool of internal candidates with development plans, a live external option, a timeline mapped against board terms and the strategic plan, and a documented annual review.
How many GCC boards have a formal succession plan?
The GCC BDI Board Effectiveness Review 2025 found 67 percent of respondents report no formal succession plan in place. Around 39 percent reported having a plan for executive and other critical organisational roles, and just over a quarter had formalised responsibility for CEO succession with the board or a committee in the preceding twelve months.
Can shareholders remove a chair in Saudi Arabia?
Shareholders holding at least 10 percent of voting shares may request the removal of board members through the ordinary general assembly under the amended Implementing Regulation of the Companies Law for Listed Joint Stock Companies. Where removal would take the board below quorum, it takes effect only once a replacement is elected, and the board must convene the general assembly for that election within 75 days.
