News
Interim Executive Leadership: Not Just A Stopgap
John O'Leary • April 30, 2026
What was once viewed as a temporary stopgap is now recognised as strategic capability.
As organisations operate leaner than ever, through automation, AI-enabled processes, and efficiency drives, the pressure point is clear: when major initiatives arise or executive roles become vacant, there is little capacity left to absorb the workload. Interim executive leadership bridges the gap, maintaining momentum and delivering change at pace – while a quality permanent search secures the right long-term appointment.
What's Driving This Shift
Lean Operations Creating Capacity Walls
Organisations that have successfully streamlined operations are vulnerable to the trade-off: when major initiatives emerge, there’s little capacity in the system. A private equity-backed logistics organisation acquiring two competitors can’t pause organic growth to integrate the acquisitions. A publicly listed financial services firm implementing new regulatory requirements can’t pull their Chief Financial Officer off business as usual for nine months. The permanent executive team that runs lean operations brilliantly often lacks the bandwidth for the strategic initiatives that drive growth.
Business Continuity During Leadership Transitions
Leadership transitions may be more frequent than boards would like. According to FTI Consulting’s 2024 Global CFO Report, 61% of Chief Financial Officers globally report average tenure of less than five years, and Chief Executive Officer turnover follows a similar pattern. When an executive exits, organisations face a choice: rush a permanent appointment, redistribute workload across an already stretched team, or maintain momentum with interim leadership while a thorough permanent search runs in parallel. Without interim support during the transition, the risk is real – critical decisions get delayed, strategic projects stall, and team morale suffers when colleagues absorb additional responsibility.
From Stopgap to Strategic Capability
Private equity firms are expert at leveraging flexible, high-calibre leadership into their portfolio companies to execute value creation plans without long-term fixed costs. The model is powerful and accessible with the right partner – proven interim executives (sometimes referred to as fixed-term contractors) are brought in to deliver defined outcomes while the permanent search identifies the right long-term appointment, then transitioned out when that person is in place. In many cases, the interim executive becomes the permanent appointment – an effective de-risking mechanism that lets both the organisation and the individual assess fit before committing long-term. We’re now seeing this model adopted well beyond private equity – ASX-listed companies and large private enterprises are building interim capability into how they plan, not just how they respond.
The Delivery Advantage
When organisations face major initiatives, many have historically turned to consulting firms. The interim executive model offers something fundamentally different: accountability from the inside. An interim executive integrating an acquisition isn't engaged alongside the business – they're embedded within it, leading teams, owning decisions, and driving outcomes as part of the leadership team.
What This Means For
- Private Equity Firms and Portfolio Companies: The model of running assets lean whilst executing rapid transformations is being adopted more broadly across the Australian corporate landscape. Interim executive talent provides senior capability precisely when and where it is needed, without inflating the fixed cost base. When that interim executive is also a potential permanent appointment, the engagement becomes a live assessment – providing a powerful de-risking mechanism on both sides of a critical hire.
- Boards and C-Suite Executives: Major transactions, transformation projects, and unexpected executive departures no longer require a choice between overwhelming the permanent team, rushing critical appointments, or engaging consulting firms. Executive interim leadership provides a fourth option: proven leaders who own delivery, integrate with the organisation, and transition out when the initiative is complete or the permanent appointment is in place.
- Talent and Human Resources Leaders: The calibre of interim executive talent now accessible, and the speed at which it can be deployed, is reshaping how talent leaders advise the business on leadership capacity. Building those relationships before capacity constraints or leadership transitions emerge is the difference between a reactive conversation and a strategic one.
The organisations getting this right aren’t treating interim leadership as a fallback – they’re building it into how they think about leadership capacity and talent strategy. Interim and permanent executive search are powerful partners: one buys the time the other needs to ensure you get the right talent solution for your organisation.
If you're exploring how interim executive leadership works in practice, reach out to John O'Leary, Partner – Interim. To learn how interim and permanent executive search could work together for your organisation, contact us here. We'd welcome the conversation.
Derwent brings together executive search, interim solutions, and board search, partnering with your organisation to find and connect the right high-impact talent to support your leadership needs, now and into the future.
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A board career is a fantastic one for those who love strategy and working across a range of sectors and settings, but the mental load shouldn’t be underestimated. Senior executives gathered in Brisbane earlier this month for our latest Pathway to the Boardroom event, where we were joined by Craig Manson and Jo Willoughby . We returned to some of the ground covered at our recent events from a different angle, and further explored the risks facing directors, different board settings and the realities of the role. Seven themes stood out. The first few board roles take time The move into the boardroom is situational and can follow a career crossroads. A board opportunity presenting soon after leaving an executive role can be taken as a sign that the timing is right. It can also be driven by realising the demands of executive life no longer suit you and choosing to pivot your career into the boardroom. Getting your first few board roles can take a long time, and your decisions need to be made purposefully. You should be prepared for a long journey and ready to stay open and curious. Caution matters too when considering opportunities: risk profiles need to be aligned, and the unintended consequences of an opportunity need to be thought through. It is important to be in a position to sustain yourself financially while your portfolio builds. Is a not-for-profit a good way to start? One perspective is that not-for-profit boards are a poor starting point given they tend to carry higher risk profiles and can lack the resources to protect their directors. Advisory boards can be a better pathway, and you can contribute expertise without being responsible for big decisions. Another view is that a not-for-profit is the easiest way to begin. It gives you clarity on your own risk appetite, a good grounding in governance, and informs your view on building your portfolio. 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It also means meeting with past directors and the management team, and gathering intelligence from other people in the organisation. A listed environment is intense and subject to high scrutiny. Going through a listing can be taxing on executive teams, and as a director you spend substantial time on compliance. There are continuous disclosure requirements, and the stakeholder gaze is constant. Government boards are also high scrutiny with a lot of reporting, though the personal accountability differs. Your obligations as a director don’t change, it is just a different cadence in a listed environment. In private organisations, you get slightly closer to the organisation with more hands-on involvement than in listed environments. Founder-led organisations are different again. No two founders are the same, and you need to be clear on your own risk appetite, as you are taking on legal risk as well as personal and professional risk. It is important to understand upfront the founders’ motivations and alignment to the business, as once a founder takes money from investors it is no longer solely their business. Go in with your eyes open and be prepared for what comes next. Whatever the organisation, you need to enjoy what you are doing and understand whether you and the organisation can deliver the expected outcomes, and the investment case you will be held accountable for. Being able to ask the right questions is key There is constant change with emerging technology and AI, and boards need to think about how to engage with the different technology skillsets. You are expected to know about AI, data, and how to protect an organisation against cyber threats, so being an educated generalist on these matters who knows enough to ask the right questions is key. That means continuing to upskill for as long as you are on a board. Boards also need transformation and change capability, which comes from directors who have run organisations, can work through ambiguity and change cycles, know their customers and can bring the customer voice to the boardroom. Directors must be able to read and interrogate financial statements to ask the right questions. Behavioural skills are harder to assess. Humility and integrity are important, as is the ability to build connection with other directors: being collegial, open-minded and emotionally intelligent. Good directors have firm opinions but are open to feedback and ultimately changing their opinion. The dynamic and effectiveness of the board are crucial, and the culture around a board table must be right. An effective Chair is crucial to a board’s success The relationship between the Chair and the Chief Executive Officer is critical. A Chair who understands what it is like to be a Chief Executive Officer can make a great mentor. A good Chair is curious, is motivated by wanting to build a great team, and is a unifier and driver who asks the right questions. How a Chair manages differences of opinion and robust conversations is critical to the success of the board. A good Chair is always a step ahead when it comes to succession planning. It should always be top of mind, because thinking about where the next generation of leaders will come from matters for the sustainability of the organisation. The job is always on You are always on call, and you never know what will come up next. You have to be accessible and prepared to be available whenever you are needed, and the mental load is real. You’re not in it for the money; you do it for the love of the work. For those who enjoy strategy and working with organisations to help them make better decisions, it can be very rewarding. _________________________________________________________________________ The conversation on what it means to be board ready continues, and Brisbane added the question of fit: which type of board setting suits the risk a director is willing to carry, and what the role will ask of them once they are on it. Our thanks to Michelle Gardiner , Managing Partner – Board practice at Derwent, for hosting the morning, and to Jo and Craig for sharing their experience with such practicality and honesty. Continue the conversation For further insights or to explore how Derwent can support your organisation's approach to board composition and succession, connect with our team at brisbane@derwentsearch.com.au . To register your interest in future Derwent events, please reach out to us at events@derwentsearch.com.au .
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One thing some directors wish they had known at the beginning of their journey is that not every board is the right fit for you personally. The pathway involves a lot of rejection, and it takes maturity to reflect on what you have to offer as well as personal interest. Boards appoint based on what the organisation needs, so a rejection reflects a decision made in the board's interest rather than a judgement on the individual. It's also important to do due diligence on boards before joining. Non negotiables for joining a board include hygiene issues such as financials and legal but testing the people and culture of a board is imperative, this includes checking who among your own network has already worked with people on that board. Board culture reflects both an ability to vigorously debate ideas and a commitment to board solidarity to make a collective decision. A successful board is comfortable with both. The skillset is different. Skills that serve well in an executive career don't automatically transfer to the boardroom. Early on, a new director may be eager and want to ask lots of questions, but in a boardroom, what adds the most value is listening and adding a considered perspective. At a board meeting some of the most impactful directors can often sit quietly for most of a board meeting and make one well-judged contribution that makes a pivotal difference to the decisions made. The mindset shift matters too, in the executive world, a role carries responsibility for a function, but board directors are accountable for the whole organisation, which includes identifying contradictions, such as a growth target that conflicts with the risk appetite. Board composition expectations are shifting. The skills matrix is evolving. Finance, legal, governance and industry expertise remain core, but emerging skills such as cyber, work health and safety, and AI, once viewed as a specialty sitting with one expert board member, are now shifting to an expectation that all board members must understand. Directors need to be diligent about upskilling, particularly in AI, which is changing how organisations do business. Behavioural attributes matter just as much as technical capability: relentless curiosity to understand what is happening in the organisation, the confidence to change your mind and be challenged in your thinking, and a collaborative style comfortable with viewing the board as a collective that gains from the diversity of everyone in the room. Succession planning must be continuous. Boards need to discuss succession planning continuously to ensure it is orderly and timely, whether in response to volatility in the world, or externalities that require a transformational pivot. This includes carefully considering the timing of bringing on a new director. Chief Executive Officer succession is a particular challenge, requiring a balance between people feeling safe in their roles and the reality that a CEO who is well regarded today may not continue to be the right person for the organisation in a fast changing environment. The importance of building strong relationships can't be underestimated Trust is the foundation of a well-functioning board. In a crisis, directors rely on colleagues who will commit time and energy to resolving the problem as a team, and who can be counted on to ask the hard questions. That confidence has to be built well before it is needed. Because board members typically meet once a month or less often, relationships need deliberate attention, such as volunteering for a committee together, suggesting a webinar or inviting a fellow director for a coffee. _________________________________________________________________________ Our thanks to Michelle Gardiner , Managing Partner at Derwent, for hosting the morning, and to Jacqueline and Sylvia for such generous, practical insight into the realities of board life. Continue the conversation For further insights or to explore how Derwent can support your organisation's approach to board composition and succession, connect with our team at sydney@derwentsearch.com.au . To register your interest in future Derwent events, please reach out to us at events@derwentsearch.com.au .
