Strategic Win

4 the Most Common Reasons for a CEO to Quit

The CEO can be fired like any other employee. However, due to the status (this is a leadership position with wide powers), the algorithm of dismissal differs from the standard one. Dissolving an employment contract with a CEO takes a long time – it takes a lot of time to complete the formalities, including transferring matters to a successor, calling a founders’ or shareholders’ meeting, filing grounds for termination and changing entries in the state register of the company legal entities.

Reasons for a CEO Change

Practice shows that the replacement of the gene. Directors can be provoked by many factors. However, there are most common reasons:

  • agreement of the parties or own solution;
  • termination of the employment contract and refusal, on the part of the founders or the director himself, to renew it;
  • decision of the founders (or founder);
  • liquidation of a legal entity.

The decision to change the gene. The Director is accepted by the General Assembly / Founder of the Organization, whereupon a corresponding decree is issued dismissing the current Director and ordering a new one to be appointed in his place, whose candidacy is also elected by the General Assembly of the Association.

CEO Change Process

The change of director general will be formalized in several successive phases. It is recommended to start this procedure by obtaining a new extract from the Unified State Register of Legal Entities, since according to the law all information about the currently functioning gene is stored there. Director. This extract makes it possible to verify the data contained therein with the data in the company documents. If deviations are found, they can be corrected as part of the feedback process. The same extract is required to certify the signature of the head (its authenticity) by a notary. Depending on the requirements established by the notary, the deadline for issuing an extract from the Unified State Register of Legal Entities can be 10 or 30 days. The gene modification is then registered. Directors are performed in the following order of actions:

  • general meeting of participants or founders of the organization, at which either a decision is taken to remove the current director general from his position, or a motion to dismiss him is considered;
  • preparation of a package of all necessary documents;
  • notarization of the authenticity of the signature of the head selected as the applicant (can be both the new and the old general director of the organization);
  • handover of the completed document package to the responsible approval authority (ifts at the site);
  • obtaining documents specifying the registration of changes;
  • examination of the received documents for possible errors by the registration authority and, if found, returned immediately (on the same day) for correction;
  • notifying the bank where the company’s current account is located about the change in the management of the organization;
  • certification of the model signature of the named gene. managing director in a card with sample signature and imprint of company seal;
  • transfer of all documents of the organization from the previous director general to the new one according to the act of acceptance and transfer;
  • conclusion of an employment contract with the appointed general manager and issuing a decision on his entry into this position.

In addition, the change of the general director of the organization has been completed.