Mr Maxsted said the new chairman needed to come before a new CEO but governance experts are calling for a big-name external appointment and question how Mr Maxsted can be involved picking his own replacement, despite assurances that he will not.
“I struggle to see how he can be involved appointing the next CEO or chairman,” one of the country’s leading board recruiters said. “The first question any potential CEO wants to know is who am I working for.”
The recruiter pointed to well-respected former Westpac and recently departed BHP and Stockland director Ms Hewson as an obvious option for next chairman.
“She hasn’t been caught in any scandal and is highly regarded,” they said.
Past Westpac directors including chairman of Virgin and IAG Elizabeth Bryan or Woolworths chairman Gordon Cairns could also be considered.
Former Westpac CEO Gail Kelly could make a remarkable return, although aside from being touted as the possible BHP chairman and sitting on the Singtel board, she has not pursued a deep career in directorship.
If the bank is pushed to appoint a chairman with less direct connections, it look overseas to the likes of Singtel’s Kiwi chairman Simon Israel.
A short-term fix could also be to consider a veteran chairman with banking experience, such as Michael Chaney or Graham Bradley, but their current commitments and age make them seem unlikely.
“David Morgan I think is a no,” proxy adviser at ISS Vas Kolesnikoff said, pointing to his age, London home and short stint at BHP. “The bank has moved on from when he was there and I don’t think he sends the right signal to the community and management.
“And let’s stay away from accountants and lawyers who say they are governance experts, because what Westpac needs is not someone who is an expert on the minimum standard of the law.”
A sub-committee is expected to be set up to work with Korn Ferry on the chairman’s appointment but with Mr Hartzer, Mr Maxsted and director Ewen Crouch going, Mr Harker and Mr Nash candidates for the job, and more directors under threat, one investor asked: “Who is left to run it?”
The messy succession which includes Mr Maxsted staying on until next year and the debate over a new chairman means a new CEO may not be able to start until 2021.
The transition has been compared to NAB, where chairman Ken Henry stayed on long after he stood down. But in that case, the highly respected Phil Chronican was appointed acting CEO and then quickly appointed chairman-elect to pick the new CEO Ross McEwan, who starts next week.
A global search to replace Hartzer as CEO is also under way and Westpac interim chief executive Peter King is not ruling himself out.
Other names have included the Australian-born Royal Bank of Scotland retail bank chief Les Matheson and Macquarie deputy boss Greg Ward, and Medibank CEO Craig Drummond or NAB’s Mike Baird as outside chances.