SAP has a new succession plan

The changing of the guard at the top of SAP’s supervisory board is anything but smooth. The German software company has announced that Punit Renjen, who it originally intended would become chairman of the supervisory board, is to be replaced. They have mutually decided to go their separate ways, SAP said in a statement.

The reason given for the sudden separation was “a difference in perspective” about the role of the future chairman of the supervisory board.

At SAP’s Annual General Meeting on May 15, 2024, Renjen will also step down from his seat on the company’s supervisory board, which he only took up at last year’s AGM.

Instead, the supervisory board has nominated Pekka Ala-Pietilä for election to join it, and announced him as the designated successor to Hasso Plattner, the current chairman. Ala-Pietilä is to be proposed for election for a two-year term of office at the next AGM and, if elected, will also assume the role of chairman of the supervisory board.

With 67-year-old Ala-Pietilä, SAP believes it has found the right man. The Finn is “excellently positioned to support SAP’s continued successful transformation,” it said. Ala-Pietilä was President of Nokia from 1999 to 2005 and a member of SAP’s supervisory board between 2002 and 2021. In addition, from 2018 to 2020, he served as chairman of the European Commission’s high-level expert group on artificial intelligence.

Déjà vu

“In Pekka Ala-Pietilä, I recognize a leader who not only possesses a profound understanding of our industry and the intricacies of European SE governance, but also one who has been a steadfast ally through many of SAP’s pivotal moments,” said SAP co-founder Plattner, who has served as chairman of the supervisory board since 2003. “As we welcome Pekka Ala-Pietilä, I am filled with confidence that SAP’s Supervisory Board is in the most capable hands. His vision and well-measured approach are exactly what SAP needs to safeguard its future and ensure its ongoing success.”

However, similar things were heard a year ago, when SAP presented Renjen as the new man for the top of the supervisory board. Plattner’s farewell to the big SAP stage is bumpy. The Berlin-born manager, who celebrated his 80th birthday on January 21, 2024, founded SAP in 1972 together with his colleagues Claus Wellenreuther, Hans-Werner Hector, Klaus Tschira, and Dietmar Hopp.

Plattner has been chairman of SAP’s supervisory board for two decades, which has repeatedly given rise to criticism in recent years. For the man who controls SAP strategy from behind the scenes, internal rules did not seem to apply: The term of office of the chairman of the supervisory board at SAP was supposed to be limited to 12 years, with the person holding the post not older than 75 years.

Difficult search

The search for a successor had been difficult, Plattner told German newspaper Handelsblatt a year ago, explaining his decision to remain at SAP. Initially, the company wanted to appoint an internal candidate, but this plan fell through, he told the paper. The search among former SAP top managers also did not work out. Then, after a long search, a suitable candidate for Plattner’s successor was finally presented in the form of former Deloitte CEO Renjen.

But this was obviously not a lucky hand in Walldorf, as the latest reversal now proves. In any case, there can be no talk of a structured transition at the top of the supervisory board, of which Plattner spoke on the occasion of Renjen’s nomination a year ago in order to ensure the necessary continuity for the further growth of our company. At the same time, the German software company needs stability on the supervisory board right now. SAP is undergoing the most fundamental strategic change in its history, it has been said again and again from the ranks of the management.

Ala-Pietilä will now have to ensure that calm returns to SAP’s supervisory board and that the turning point with Plattner’s departure takes place as smoothly as possible.

The Finn politely thanked SAP’s supervisory board and Plattner for “the opportunity to rejoin this dynamic European technology leader at such a pivotal time.” SAP has been setting the global standard in enterprise technology for over 50 years and continues to be a pioneer in developing relevant, reliable, and responsible AI solutions for enterprises to fundamentally change the way business is done, he said. “I look forward to working together with colleagues old and new to build on SAP’s track record of delivering revolutionary technology that drives real results.”