2014 February CEO Report: 112 CEOs Out, 243 YTD
Turnover among the nation’s chief executive officers declined 14.5 percent in February, as 112 CEOs left their posts during the month. While last month’s total was down from 131 CEO departures in January, it was the heaviest February turnover since 2010 when 132 changes were recorded, according to a report released Wednesday by global outplacement consultancy Challenger, Gray & Christmas, Inc.
The February total was 1.8 percent higher than the same month a year ago when 110 CEO exits were announced. To date, 243 CEO changes have been announced in 2014, which is nine percent more than the 223 tracked in the first two months of 2013.
Healthcare was the leading sector in CEO changes last month with 31, 17 from hospitals and hospital systems. Of the hospital CEOs who left their positions, 7 found new positions as CEOs in other hospitals.
The computer sector had the second highest number of departures with 16, including the CEO of Google-owned YouTube, where Sala Kamanger resigned after four years on the job. Computer was followed by the government/non-profit industry, which counted 14 CEO changes.
YouTube’s Kamanger was one of 30 CEOs who resigned in February. Resignation was the most oft-cited reason for the CEO’s departure. Another 28 CEOs retired from their positions, and 23 stepped down from the CEO role, usually as Chairman or other C-level executive.
Companies based in California had the highest number of CEO departures in February with 18, followed by Texas who recorded nine CEO changes. Both Missouri and New York-based organizations announced six CEO departures.
“Of the 112 CEO departures announced in February, 88 included information about the replacement. In 45 instances, the replacement came inside the company. Eight of these individuals were recorded as filling the CEO office on an interim basis. It is likely that these interim CEOs will eventually be replaced by external candidates,” noted John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“Among the nine interim CEOs replaced in February, eight were supplanted by an outsider. The fact that an interim CEO was needed could indicate that these companies do not have a solid succession plan in place. The fact that they are often replaced by external candidates suggests that companies may be seeking a new strategy that deviates from the former CEO and interim CEO’s path.
“The interim CEO may fall back into his or her pre-CEO role, but that may not last long, as sweeping executive changes in the C-suite typically follow a CEO change, particularly when that CEO comes from outside the company. The new executive is likely to bring in people he or she worked with at other companies,” noted Challenger.