2017 March CEO Report: CEO Exits Surge 40 Percent
Turnover among the nation’s chief executive officers surged to 101 in March, 40 percent higher than the 72 CEO changes announced in February, the lowest monthly total since the 56 CEOs recorded in December 2004, according to a report released Wednesday by global outplacement consultancy Challenger, Gray & Christmas, Inc.
March CEO changes equal the number of CEOs who left their posts during the same month last year. Through the first quarter, 301 CEOs have left their posts, 6 percent lower than the 319 that occurred in the first quarter of 2016, and less than 1 percent lower than the 304 CEO changes in the fourth quarter of last year.
Government/non-profit entities lead all industries so far this year with 42 CEO changes, 22 of which occurred last month. Hospitals recorded 39 CEO changes through March, while financial firms account for 30 exits. Service companies saw 24 CEO changes in the first quarter, while computer companies reported 19.
A total of 111 chief executive officers stepped down from the CEO role this year, but will remain active in the company, usually as a chairperson or other C-level executive. This reason was cited 50 percent more than through the same period last year when 74 CEOs remained with the company in some capacity.
“Companies typically want their leaders to remain for a period to ensure a smooth transition of responsibilities. We’re seeing an increase in companies who keep their chief executives around in some other leadership role within the company, whether that by a chairperson or board member, or chief technical or development officer.
“Company founders who have performed the role of CEO also stay on with the company once growth calls for outside talent to lead the company,” said John Challenger, chief executive officer of global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc.
Another 80 CEOs have retired this year, while 51 have resigned. Thirty CEOs found new positions in other companies in the first quarter.
California companies reported the majority of turnover this year with 41 CEO departures, 19 occurred in March. Texas, Colorado and New York each accounted for 7 chief executive exits last month. Massachusetts and Pennsylvania each saw 6 CEOs step down in March.
One notable CEO change that was announced in March came from Yahoo. The struggling tech giant, recently plagued by security breaches impacting 1 billion accounts, will replace CEO Marissa Mayer with IAC’s CFO Thomas McInerney once the Verizon deal has closed.