Tad Smith has been named as the new president and CEO of Sotheby’s. The changeover will take place on 31 March 2015.
Smith says he is “delighted to have the opportunity to lead such an iconic institution.” Sotheby’s are hoping that his background in business strategy and CEO experience will encourage success in the company. Smith added: “While the auction business is new to me I think you will find me a quick study.”
In the Sotheby’s conference call, Smith went on to explain that his immediate plan is to immerse himself in the business and industry “spending the next few months travelling around to meet key clients and members of the art world.” He also outlined plans to work with the board to analyse Sotheby’s overall strategy by creating a “five year plan for growth and increasing shareholder value” including looking at how Sotheby’s go to market and their capital allocation.
The auction house’s search for new leadership has been ongoing since November 2014 when William Ruprecht, who had been CEO since 2000, announced he would be stepping down. As well as being president and CEO, Ruprecht was also chairman of the board. In his resignation he said he would stay with the company until a replacement could be found to ensure “a smooth leadership transition.”
A committee was created to aid the search led by the lead independent director Domenico De Sole. At the time, De Sole said: “The board is focused on ensuring a smooth transition that will facilitate Sotheby’s continued success.” Sotheby’s enlisted executive search firm Spencer Stuart to help with the search for the new CEO. De Sole will now take over the role of chairman of the board.
Ruprecht’s resignation was in mutual agreement with the board, after mounting pressure from shareholders concerned with the running of the company. In the last year, Sotheby’s has seen increased pressure from its shareholders, including several acts of shareholder activism demanding action. Sotheby’s, currently the oldest company listed on the New York stock exchange, saw shareholder Thirdpoint request Ruprecht’s resignation last summer. More recently, shareholder Marcato Ltd suggested the removal of Patrick McClymont, chief financial officer, following a decision not to distribute a return to investors.
In the today’s announcement De Sole made a point to thank Ruprecht for his “exemplary service over the past 35 years.”
“We deeply appreciate all he has done to put Sotheby’s in a strong position for continued success,” he added.
When asked today about Smith’s plans for shareholder return, he was non-committal about a date for his plans to “drive the creation of sustainable shareholder value” but said that he planned to “get to work on it straight away to proceed on with pace.”
Speaking about the new CEO, De Sole said: “He is a proven leader and value creator with CEO experience, strategic vision, brand building expertise, an ability to understand and serve client needs and a track record of driving revenue and profit growth.”
In the call, he referred to Smith as “dynamic, young and strong” who comes “highly recommended and respected in prior roles.”
Prior to his appointment, Smith has most recently served at as president and CEO of The Madison Square Garden Company. Before he started at The Madison Square Garden Company in February 2014, Smith was president of local media at Cablevision Systems Corporation. Other past positions include CEO of Reed Business Information, the business-to-business division of Reed Elsevier which he joined in 2000, and internet executive at Starwood Hotels and Resorts.
Smith has a passion for art and collectibles and also teaches as an adjunct professor at the Stern School of Business at New York University, running a course on strategy and finance for entertainment, media and technology companies.