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05-07-2021 | Business

Amazon CEO Jeff Bezos is stepping down. He'll still have huge power at the company.

New York : Amazon founder Jeff Bezos will hand over his CEO title to Andy Jassy on Monday, ending a more than two-decade tenure at the head of the firm that has seen it grow from an online bookseller to a $1.75 trillion worldwide retail, logistics, and internet behemoth.

Bezos said he wanted to spend more time on his other ventures, including the Washington Post, space company Blue Origin, and philanthropy, when the company announced in February that he would shift from CEO to executive chair.

But, even as he returns to a less visible role at Amazon (AMZN), Bezos will continue to wield enormous power at the firm for years to come, as the company's largest individual shareholder, a longtime mentor to the next CEO, and as chairman of the board.

"He'll probably continue involved," said Daniel Elman, a global technology analyst at market research firm Nucleus Research, "though he'll no longer be focused on the day-to-day and instead be able to focus on company-wide projects and new goods and services." "His abilities to break through the noise and uncover high-value prospects cannot be emphasised... thus it would make sense for Amazon to release him from the operational grind so he can focus on those areas."

Bezos' departure as Amazon's CEO comes at a critical juncture for the company. The pandemic sparked a surge in demand for its services, resulting in increased earnings and recruiting. However, the company's rapid expansion has drew the attention of regulators, who feel it has grown too large.

Without the world's richest man at the leadership, the corporation may be able to withstand some of the scrutiny. Stepping down could also let Bezos avoid some of the criticism levelled at him by lawmakers.

"I'm quite sure someone along the road saw [the regulatory scrutiny] and thought, 'Here's another advantage of this timing,'" said James Bailey, a George Washington University professor of leadership development.

Amazon has also recently come under fire for how it treats warehouse workers, something Bezos has promised to address as executive chairman.

"Bezos needs to stop being the lightning rod" on the topic of Amazon's labour policies, according to William Klepper, a Columbia Business School management expert. "Instead, he needs to innovate his way out of this."

In many ways, Bezos' decision resembles that of other Silicon Valley pioneers, for whom relinquishing the CEO title meant stepping away from much of the harsh glare but not all of the power.

For example, Google's cofounders gave up their executive positions in 2019 due to increased regulatory scrutiny, but they remain on the board and own a unique type of stock that gives them voting influence as shareholders.

Bezos doesn't have quite as much voting power as Jeff Bezos, but he is still Amazon's top shareholder by a huge margin. Bezos had 51.2 million shares of Amazon common stock, or over 10%, as of last month, far more than the next largest stakeholder, Vanguard Group, which owns around 6.5 percent.

That means that if a shareholder campaign aims to make a significant change at the company, Bezos' voting power could help him influence the decision, said Bailey.

Bezos will very definitely continue to have Jassy's ear as the new CEO. Since the beginning of the company, the two have collaborated closely. According to Ann Hiatt, a former executive business partner of Bezos, Jassy spent time in the early 2000s in a position known as Bezos' "shadow," a function comparable to a corporate chief of staff that was created to train talented young executives. Jassy went on to join Bezos' elite leadership group, the "S-team," for a long period.

If there's a clear example for what Bezos' new role at Amazon might look like, it could be the other Seattle-based tech billionaire who formerly held the title of world's richest man.

Microsoft was one of the world's most powerful organisations when Bill Gates stepped down as CEO in 2000, but it was also embroiled in a years-long antitrust dispute and on the verge of being split up by the US government. At the time, Gates was regarded as a brutal monopolist, but his subsequent concentration on philanthropy helped him earn a new reputation as a global do-gooder, all while continuing to manage Microsoft (MSFT) for the next two decades – until last year.

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