Lazar Ltd. (NYSE: LAZ) Appoints New CEO, Stays In-house

The transition from a known CEO to a new CEO can always be a harrowing experience for a firm. When that transition happens unexpectedly, it is even more challenging.

When Bruce Wasserstein passed away unexpectedly in October of 2009, he left a gaping hole at the CEO and Chairman role of Lazar Ltd. (NYSE: LAZ). Wasserstein, a respected banker and prominent dealmaker helped negotiate some of the largest corporate takeovers in history, and helped build the firm’s stature and reputation in recent years. He joined Lazard in 2002 with a mission to turn the investment bank around and make it more competitive against its bigger rivals. In May of 2005, he helped take the company public.

On Tuesday, Lazard and it’s Board took a step in the right direction; appointing a longtime internal executive to the role managing the investment advisory business, Kenneth M. Jacobs.

Jacobs, 51, joined the firm in 1988 and was named partner in 1991. Through a steady progression of roles and responsibilities, in 2002 he took on the role of CEO of Lazard’s North American business, while also taking on the role of deputy chairman. Effective immediately, he will take on the role of CEO and Chairman for the firm.
Steven J. Golub, who joined the firm in 1984 and has held senior leadership positions over the years, including CFO, was named interim CEO after Wasserstein’s death on Oct. 14. He will continue as Lazard’s vice chairman, and as chairman of its financial advisory group.

Although this happened unexpectedly and seemingly ahead of schedule, it seems like the firm has benefitted from having a succession plan. Banks across the country should learn from this example (particularly, Bank of America which is struggling with a similar issue with the impending departure of Ken Lewis). Rather than relying on poaching an executive from another firm to parachute in and now manage your firm and culture, developing from within and having a set plan allows a firm to continue to operate in a tumultuous environment. Lazard has benefited from developing and retaining a stable of young talent, a model which is rather uncommon but paying dividends right now.

Lazard’s board, in a released statement, said that Jacobs was unanimously selected to replace Wasserstein, who died at age 61 after being hospitalized for an irregular heartbeat in early October.

Lazard traces its origins back to 1848, and focuses its business on mergers and acquisitions, developing corporate strategy, and asset management services.