When The Hartford Financial Services Group announced it would conduct an external search for its new CEO, it didn't surprise many Wall Street analysts who have said a "management vacuum" at the 199-year-old insurer left them no other choice but to look outside the company.
Since 2007, The Hartford has seen six top executives leave the company, with outgoing chairman and CEO Ramani Ayer becoming the latest.
That depletion of top level management left few qualified candidates for The Hartford's top spot and has raised some concerns among company investors.
"While the board begins an external search for new top management, we believe that a meaningful management vacuum has been created where future strategic decision making could be stifled," Joshua Shanker, an analyst with Citi Investment Research, wrote in a June 9 note to investors.
Shanker, who recently downgraded The Hartford's stock, said the amount of management turnover in a short period of time is concerning, especially since the "company exists in a period of uncertainty as to its future strategic direction."
The Hartford's recent departures include former president and chief operating officer of its property-casualty operations Neal Wolin, who left for a job in the Obama administration earlier this year. Shortly after that Tom Marra, president and chief operating officer and chief architect of The Hartford's life insurance strategy announced his retirement.
In an interview on CNBC last week, Ayer said the company has great operational staff still running the business. "I believe there is enormous bench here," he said.
Michael Paisan, an analyst at Stifel Nicolaus in New York, said the company "has not done a good job of retaining top executives."
In recent years, Paisan said, The Hartford promoted many individuals from its life Insurance business, which was considered "the crown jewel of the company." As a result, individuals in the property and casualty business "saw the writing on the wall and began to leave."
But now that the life insurance company has come under distress, those executives have become "the scapegoats," and are also departing, Paisan said.
"It was a perfect storm for management leaving the company," Paisan said.
Shanker said the impact of Ayer's retirement remains unclear.
"On the one hand, having given his entire career to the Hartford and having been chief manager for more than a decade, there is no one who knows The Hartford better," Shanker wrote. "However, this knowledge has not contributed to superior performance for the firm."