WH Smith Seeks New Chairman Amid Crisis

WH Smith, the London-listed travel retail group, is working on plans to appoint a new chairman as it battles to restore investor confidence in the company. The search for two new non-executive directors is expected to result in the recruitment of a candidate to replace the current chair within around 18 months.

Background of the Crisis

The company plunged into crisis by the emergence of accounting errors that sent its shares soaring in the second half of last year. WH Smith has said it will appoint a new board member with experience in the North American travel retail market, a key region for the company.

Current Chair’s Status

The current chair, who has been in the position for just three years, is also on the board of an accounting software group. Last week, she was appointed lead independent director of a clothing retailer. A person with knowledge of WH Smith’s appointment process said that while the current chair is not expected to resign this calendar year, she may do so in 2027.

Succession Planning

A source close to the company said that the current chair had been intensively engaged in dealing with its problems in recent months and that the board had focused on effective succession planning rather than actively searching for a new chairman. The company is expected to face a series of questions from shareholders about the accounting crisis at its annual general meeting early next month.

Current State of the Company

The company is already without a permanent chief executive after the previous CEO resigned as the extent of the problems became clear. The company has appointed an interim boss, who previously ran its UK travel division. WH Smith is currently under investigation by the Financial Conduct Authority over the accounting issues and is now expected to have some of its bonus awards clawed back to former senior executives.

Financial Performance

Its troubles with regulators capped a tumultuous year for the company, which included the sale of its historic chain of stores to a specialist retail investor. The company has also attracted the attention of activist investors, which acquired a stake in the company last summer. Shares in the company closed at 643.5p on Friday, giving it a market capitalization of around £810m. The stock is down about 45% in the last year.