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CSL’s new CEO has big shoes to fill

The new Chief Executive Officer (CEO) of biotech CSL (ASX: CSL), Mr Paul Perreault, officially took over the reins from his predecessor Dr Brian McNamee on 1 July.

The shareholder returns generated by CSL while under McNamee’s watch were nothing short of outstanding. Between 1990 and 2013 while McNamee was at the helm, the annual total shareholder return was 25.9%. That’s one tough act to follow!

In his first interview since taking the top job Perreault spoke with the Australian Financial Review. If there was one message to take away from the story it was ‘commercialisation’, indeed the words ‘commercial’ and ‘commercialisation’ were used eight times in the AFR’s profile of Perreault.

Having spent hundreds of millions of dollars on research and development, Perrault is charged with taking CSL’s R&D portfolio and maximising value through commercialisation. Pleasingly for shareholders Mr Perreault looks to have shareholder wealth creation front and centre in his mind — a trait and culture passed on by Dr McNamee — this was highlighted by Perreault’s mention that China is no pushover as a market to enter.

Perreault has been with CSL since 2004, so he already has nearly a decade of experience working within the company, primarily in the USA. His elevation to CEO also involved a handover period from McNamee that lasted nearly one year.

Great management is a key ingredient for companies that succeed in creating significant shareholder value. Other recent ‘changing of the guards’ where there are big shoes to fill include Fantastic Furniture (ASX: FAN), where founder and executive director Mr Julian Tertini has moved to a non-executive role, and Seven Group (ASX: SVW) where Mr Peter Gammell has resigned and been replaced by former Woodside Petroleum (ASX: WPL) MD and CEO Mr Don Volte AO.

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Motley Fool contributor Tim McArthur owns shares in Fantastic Furniture.

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