António Horta-Osório
The Leadership Dilemma
The leadership dilemma has been reported as one of dealing with shareholder discontent. According to the Sunday Telegraph [13th Nov 2011]:
Major institutional shareholders are concerned at the lack of information from the bank since Mr Horta-Osorio left on medical advice two weeks ago …a number of investors said that they had not been personally contacted by Glen Moreno, the senior independent director, or by Sir Win Bischoff, the chairman, about the issue.
The sentiment among investors is that even if Mr Horta-Osorio returns to full health, it would be difficult for him to return because of the signal his absence – the result of “extreme fatigue” – has given to investors.
“It is clear the job was too big for him,” said one top 15 shareholder.
Another investor questioned why the bank was not speeding up its internal contingency plan.
Behind the headlines
The Telegraph article suggests that the company has failed to have addressed the reactions of its shareholders to the departure of Mr Horta-Osorio. Looking behind the headlines, I wondered whether the story was encouraged by parties dissatisfied with the performance of the board, and would welcome news that would discredit them before rhe appointment of an internal figure as interim CEO (Mr Moreno has been considered as a favourite candidate).
Another possibility is that powerful institutional shareholders see opportunity to exercise more influence over the Board’s decisions
What didn’t happen
What appears not to have happened is for a rapid line of communications to have opened up with the most influential stakeholders. While ‘wait and hope’ may have been a consideration, it is often a dangerous kind of strategy under conditions of corporate turbulence.
To go more deeply
The textbook Dilemmas of Leadership examines the importance of trust based leadership[chapter 6] and the challenges presented by corporate turbulence [chapter 11].
Posted by Tudor Rickards 
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