Every industrial sector worries about succession planning. The specialty chemicals industry carries a specific set of pressures that make the problem harder to solve and slower to fix once it’s identified.

At the top of the industry, the path to CEO takes longer than in most sectors

Heidrick & Struggles analyzed the backgrounds of 129 CEOs at chemicals companies worldwide with revenues over $2.5 billion. The pattern it reveals says something about the sector’s succession culture more broadly: chemicals executives typically take longer to reach the CEO seat than their counterparts in the broader industrial sector, and they tend to be further along in their careers by the time they get there.

The same analysis found that 61% of current chemicals CEOs at these large companies were hired internally, a stronger preference for internal promotion than many other sectors show. Heidrick’s consultants reported that in conversations with boards and leadership teams, a common theme emerged: companies’ immediate succession pools were weaker than they wanted them to be, leaving boards to choose between fast-tracking a stretch candidate or looking outside the company.

Smaller and mid-sized specialty chemical companies don’t have boards running formal, multi-year CEO succession processes the way $2.5 billion companies do. The underlying dynamic is a strong cultural pull toward promoting from within, paired with a thin bench once someone actually needs replacing. It shows up just as often, if not more, at owner-operated and closely held companies. It’s just less likely to be caught early, because there’s no board process forcing the conversation.

The workforce feeding that pipeline is more tenured than the general U.S. workforce, and a large share is near retirement

Workforce research cited by Net at Work found that the U.S. chemical industry’s workforce skews notably more senior in tenure and career stage than the overall U.S. workforce. Multiple industry sources converge on a similar figure for the scale of the retirement risk: roughly a quarter of the chemical workforce is projected to be eligible to retire within the next five to ten years, a figure reported consistently by Talent Traction and Agilis Commerce.

At the same time, Deloitte and The Manufacturing Institute have projected that U.S. manufacturing broadly may need to fill as many as 3.8 million jobs by 2033, with as many as 1.9 million of those positions going unfilled if current talent challenges aren’t addressed, and more than 2.6 million baby boomers are expected to exit manufacturing jobs over the next decade. Chemical manufacturing sits inside that broader wave, but with an added wrinkle: much of the expertise walking out the door in chemicals is tacit and technical. Agilis Commerce points out that chemical companies often rely on long-tenured employees who hold undocumented, critical process knowledge; insight into formulations, plant-specific quirks, and regulatory nuance that was never formally recorded and doesn’t transfer through a job description.

Ownership structure adds another layer, and this is where mid-market companies feel it most

Specialty chemicals is one of the more fragmented segments of the broader chemicals industry. In chemical distribution, for example, one of the largest players, Brenntag, holds less than a 7% market share, and the next 40 players in the top 50 hold less than 15% combined, according to a 2024 report from TM Capital. That fragmentation is precisely what makes the sector attractive to private equity: BCG notes that private equity firms typically target underperforming businesses in fragmented subsectors with strong margins and consolidation potential; a description that fits small and mid-sized specialty producers far more than it fits the handful of large, publicly traded chemical majors. BCG reports that private equity has accounted for roughly one-third of total chemicals deal volume over the past decade, and Capstone Partners found that private equity deals made up 47.6% of chemicals sector transactions year-to-date in 2025, with platform acquisitions reaching their highest share on record.

In practice, this means a large share of the ownership churn in specialty chemicals is happening at exactly the size of company that’s least likely to have formal succession infrastructure in place. A separate, broader look at business succession, not specific to chemicals, found only 30% of small business owners have a succession plan, compared with 62% of mid-market business owners, according to a Nationwide-sponsored study cited by Regions Bank. That’s a general small-business statistic, not a chemicals-specific one, but it lines up with what the chemicals M&A data suggests: the companies most likely to change hands are also among the companies least likely to have a plan in place for who leads next.

Frequent ownership change is not the same thing as succession failure, but it does mean many specialty chemicals companies, especially smaller, founder- or family-owned ones, are navigating leadership transitions and ownership transitions at the same time, often without the kind of long-tenured, board-driven succession infrastructure that a large, stable public industrial company has had decades to build.

Putting it together

None of these factors is unique to specialty chemicals on its own. Retirement-driven turnover, thin internal benches, and private equity ownership all show up elsewhere in industrials. What’s distinctive is that in specialty chemicals, they overlap, and for small and mid-sized companies in particular, they overlap without the formal governance processes that catch the problem early at larger, public companies. A workforce more senior in tenure than the U.S. average, a sector-wide preference for internal succession that even large companies’ boards say isn’t well-supported by their current bench, deep pockets of undocumented technical knowledge concentrated in a shrinking pool of long-tenured employees, and an ownership landscape where control changes hands more often than in most other industrial sectors; all of it lands hardest on the companies least equipped to formally plan for it.

Any one of those pressures is manageable. Together, they’re a good explanation for why so many specialty chemicals leaders, especially at smaller and mid-sized companies, find succession planning harder than they expected it to be.

Are you looking for top talent in the Specialty Chemical, Advanced Materials, or Animal Health industry?

Contact us to discuss how we can bring top leadership talent to your team. Boaz Partners is a premier executive search firm focused on the direct recruitment of executives and professionals for specialty chemicals, advanced materials, and animal health spaces. We are your partner, and our focus is on custom recruiting solutions. Follow the link to learn more about how our specialty chemical recruiters can help you.

Sources