Few companies have ever relied on 2 CEOs. Why does Paramount now need 3?

Good morning. Most companies don’t deploy co-CEOs, but Paramount Global now has three. Paramount (no. 134 on the Fortune 500) announced on Monday that Bob Bakish, president and CEO, would be stepping down as CEO and from the board of directors, effective immediately. The media giant now has an “Office of the CEO” composed of three senior company executives: George Cheeks, president and CEO of CBS; Chris McCarthy, president and CEO, Showtime/MTV Entertainment Studios and Paramount Media Networks; and Brian Robbins, president and CEO of Paramount Pictures and Nickelodeon.

The CFO, Naveen Chopra, said on Paramount’s Q1 2024 earnings call on Monday that he’s “looking forward to working closely with George, Brian, and Chris," who are "longstanding, seasoned executives, with deep expertise across their businesses, and are well positioned to guide the next chapter of Paramount.”

But can such a setup work, especially at such a large company? “Having more than one person as CEO is highly unusual and typically not a long-term solution,” according to Scott W. Simmons, co-managing partner of executive search firm Crist Kolder Associates. “People inside and outside of the company will continue to wonder, ‘Who is really in charge?’”

With employees nervous about the swift departure of Bakish, Paramount’s Office of the CEO addressed those concerns in a joint memo on Monday afternoon, Deadline reported. The message followed a company-wide email from Shari Redstone, chair of Paramount’s board of directors, announcing the news.

I contacted Paramount to ask if Chopra would be reporting to one or all three CEOs, but didn’t receive a response. So I also asked Simmons, who said in such a scenario a CFO technically would report to all three.

“That said, one of the CEOs in a co-CEO situation usually handles the management oversight of the team,” Simmons explained. An example he offered is at Copart, which provides online vehicle auctions. Until recently, the company had co-CEOs in Jay Adair and Jeff Liaw.

“While they carried co-CEO titles, Liaw was running the day-to-day management of the company and operations,” Simmons said. “It was not a surprise—nor, I doubt, was it a shock internally or externally—when Liaw was named the sole CEO of Copart a couple of months ago, and Adair was named executive chair.”

Cloud software company Workday (sponsor of CFO Daily) recently used a co-CEO model to transition to a new chief executive, Carl Eschenbach. He began his tenure in February as sole CEO after jointly serving for more than a year alongside Workday founder Aneel Bhusri, who is now executive chair.

Simmons told me he's expecting a similar situation to play out at Paramount, which soon enough "will gravitate towards the norm of having one person as CEO."

Bakish joined Viacom in 1997 and became CEO in 2016. A merger of Viacom and CBS made him CEO of ViacomCBS in 2019, with the company renamed Paramount Global in 2022, two years after Chopra joined as CFO.

“Not only did Bob help navigate a number of challenges, but I'm proud of all we've accomplished, and it's been my privilege working together with him,” Chopra said on the earnings call.

Reports surfaced late last year that Redstone was open to selling her media empire. Sony Pictures Entertainment and Apollo Global Management may make a joint offer for Paramount. And the company has been in discussions to merge with media company Skydance, which has offered a $3 billion cash infusion that Paramount can use to pay down debt or buy back stock, according to the New York Times.

I asked Simmons whether Paramount’s Office of the CEO decision could help a potential acquisition. “That is certainly plausible,” Simmons said, “as it could be a strategy to buy time in order to let something play out.”

Sheryl Estrada
sheryl.estrada@fortune.com

María Soledad Davila Calero curated the Leaderboard and Overheard sections of today’s newsletter.

This story was originally featured on Fortune.com