John Elkann, the fifth-generation chairman of Fiat Chrysler, has stepped down from the board of American media multinational News Corp.
In a statement, News Corp—owned by Australian-born American media mogul Rupert Murdoch—said Elkann left the board in light of the increased demands of his role as chairman of his family’s investment vehicle, Exor.
Elkann, 40, joined the board of the “new” News Corp as an independent, publicly-traded company following the separation of its businesses from 21st Century Fox in June 2013.
His role on the News Corp board highlights an often-overlooked network of family business leaders that share experience at the very top by serving on each other's boards.
“With his vision and good judgment, John Elkann has been a significant part of our company’s progress. I am grateful for his friendship, and for all he’s done for us at News Corp,” executive chairman Rupert Murdoch said in a statement.
A number of different families sit on the board of Elkann’s family investment vehicle, Exor. Samsung third-generation executive Lee Jae-yong and SHV Holdings chairman Annemiek Fentener van Vlissingen both serve as Exor independent directors.
Following his appointment in 2011, a spokesman for Exor told CampdenFB that the nomination of Lee was part of Elkann’s efforts to establish links between his family—the Agnellis—and “other important families in the international business world”.
However, the 48-year-old South Korean, who is the eldest grandson of late Samsung founder Lee Byung-Chull, may soon have his hands full: the board of directors at Samsung Electronics this month nominated the next-generation executive to its board, a move that signals his likely succession.
In a further example of leaders sitting on the board of other family business, Dr Jürgen Heraeus, chairman of the supervisory board at the eponymous German technology group, also holds an advisory role at local industrial gas supplier Messer Group.
Advisory boards are a popular governance mechanism with 95% of family businesses having one, according to KPMG.
However, advisory boards are not without their risks: KPMG said some leaders are reluctant to implement an advisory board from fears about losing control, losing confidentiality, and lengthening the time it takes to make decisions.
The advantage of an advisory board at family enterprises, particularly when the individual is from an external family business, is that the individuals often do not have a vested interest in the business and force leadership to look to the future and consider the challenges and opportunities ahead.
News Corp is currently looking for replacements for Elkann, who leaves to manage the increasing demands of his role as chairman and chief executive of Exor and its large investments, including FCA Group and the newly acquired insurer Partner Re.
“I’m very thankful to have had the chance to serve as a board member of News Corp during this fascinating period of the company’s history and development,” Elkann said in a statement.
“I wish Rupert, Robert, and their hugely talented News Corp team continued and growing success in all they do, deploying News Corp’s extraordinary skills and potential to the huge opportunities of a relentlessly more digital world,” he added.