Fending knights or masked kings: toward a theoretical framework of interim CEO succession

Purpose – There is no previous systematic and theoretical investigation of the interim CEO succession practice. This research attempts to fill the gap by studying this phenomenon and hence advance executive succession research/practice. Design/methodology/approach – Based on agency theory, the authors propose a model and several propositions to predict what determines the origin of interim CEOs, the length of the interim tenure, and the career prospects for the interim CEO after the interim tenure. Findings – Both firm performance and environmental uncertainty play an important role in the dynamic interim CEO succession process. Research limitations/implications – The paper provides the foundations for future empirical research on interim CEO succession. Practical implications – Board members at companies experiencing sudden CEO departures should choose a loyal non‐aggressive veteran to be the interim CEO so as to minimize disruption and to smooth the transition. They should use caution when choosing an internal candidate because if such a candidate is not chosen to be the permanent CEO later, a talent may be lost. Originality/value – The research is the first to systematically examine the phenomenon of interim CEOs. The authors make a unique contribution to the literature on CEO succession.