Last week Bank of New York Mellon (NYSE: BK) abruptly announced that its CEO, Robert Kelly was leaving, citing “differences in approaches to managing the company.”
The story made headlines for a day but was quickly forgotten, and the stock price has held pretty steady – both hallmarks of a communications success. Of course it helps that the bank doesn’t stir public passions the way some other banks do, and that its business dwells in the normally sedate world of securities custody and transaction processing. Still, the bank did several things well from a communication standpoint.
First, its press release was brief, factual and covered all the bases. It offered a rationale for the departure and included quotes from all quarters – the lead independent director, the newly appointed CEO and, remarkably, Kelly himself.
Second, there was nothing in the announcement that suggested a change in strategic direction for the bank, which could have spooked investors. Kelly’s successor, Gerald Hassell, is a 30-year veteran of the bank who has served on the board for more than a decade.
Third, the announcement was released after market close on Wednesday, just late enough in the week’s news cycle to blunt the impact of most news reports.
Curiously, two days later the bank made its required regulatory filing with details of Kelly’s compensation, which generated a new round of media reports. It would have been preferable to have the filing coincide with the news release, to dampen speculation and shorten the duration of the news coverage.
There are some unanswered questions, too, mainly around what exactly motivated the Board to act when it did, particularly after it renewed Kelly’s employment agreement in March. And there could be new developments in litigation, regulatory matters or strategic issues that would shed new light on Kelly’s departure. If so, the communication challenges for BK will flare up again in the coming weeks.