Zubretsky, the interim CEO
The Hanover Insurance Group's announcement last week of the planned departure of President and CEO Joseph Zubretsky for a large California healthcare organization comes as a bit of a surprise. It feels like he was an interim CEO.When he departs on Nov. 3, Zubretsky's legacy after 16-month tenure as leader of Worcester's largest publicly traded company will be marked by a corporate reorganization, layoffs, perhaps a modest financial improvement, and almost complete radio silence toward the community.
In all fairness, the bar for community involvement was set extremely high by his predecessor, Frederick Eppinger, who served as Hanover CEO for 13 years. During Eppinger's tenure, Hanover not only went from a down-on-its-luck insurance company to a global player in the property and casualty business – with its stock price rising some 250 percent – but it became a major contributor to a variety of Worcester projects, including $70 million in the CitySquare downtown development, $3 million to resurrect the now renamed Hanover Theatre for Performing Arts, and even $480,000 for improvements to the baseball field at Holy Cross, home to Worcester's amatuer team the Bravehearts. Seen by many as the godfather of the city's renewal, Eppinger was a regular fixture at business and community events through Central Massachusetts, and a hard act to follow.
Zubretsky, on the other hand, remained just a name to most in the business community, and Hanover, while a steady contributor, did not extend its community engagement on his watch. His main legacy will likely be his Hanover 2021 plan to reorganize the company for the future, but those efforts are in their infancy and could be redirected by Zubretsky's replacement. The firm cut 160 jobs in August and in February said its 2016 profits of $155 million were less than half of 2015.
Hanover does appear to be doing better this year, as second quarter operating income was 34 percent better than 2016, and Hanover's stock price is up 20 percent from the day Zubretsky took over. As someone who came from the Hartford insurance market to lead the Worcester organizations, perhaps Hanover was always going to be a stopping point before the next big gig came along.
While the focus of any business should be on its financial sustainability and growth, we are encouraged the company pegged John Roche, an 11-year Hanover veteran, as its next CEO. Roche rose to further prominence in the company once Zubretsky reorganized, leading the remade Agency Markets division. Yet, Roche was at Hanover for nearly all of Eppinger's tenure, so he knows well the mantra Eppinger operated by: The best way for Hanover to become a world-class company and attract the best employees was for Worcester and Central Massachusetts to thrive. He put his and the company's money where his mouth was, and hopefully Roche inherited those same values.
Zubretsky's reorganization may have set Hanover on the right path to continue its growth in the future, which could help Roche. The period between Eppinger's announced departure and the arrival of his replacement was a lengthy eight months. A quick decision by the board to go with a strong internal candidate to replace Zubretsky speaks well for the company's bench strength. We hope John Roche will be around for the long run, and see the fruits of his labor.
WBJ Web Partners
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