Published July 26, 2023
The number of CEO changes at U.S. companies fell to the lowest total in five months, as 118 CEOs left their posts last month. It is the lowest total since January of this year, when 112 CEOs exited the top spot, according to a report released Wednesday by global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
June’s total is down 47% from the 224 CEOs who left their posts one month prior, the highest monthly total ever recorded. It is 11% higher than the 106 CEO exits recorded in the same month in 2022. So far this year, 907 CEOs have left their posts, the highest January to June total since the firm began tracking in 2002.
Source: Challenger, Gray & Christmas, Inc. ©
“The economy is showing great resilience at the moment. We’ve seen a considerable number of changes this year, as leadership grapples with uncertainty in the coming months,” said Andrew Challenger, workplace expert and Senior Vice President of Challenger, Gray & Christmas, Inc.
“Historically, on average, June is the slowest month for CEO turnover and layoff announcements. Mid-year is the fiscal year-end for many companies, and in many cases, major moves do not occur in this month,” he added.
The second quarter saw the most quarterly CEO exits on record with 489, a 29% increase from the same quarter last year, when 379 CEO exits were recorded. It is 17% higher than the 418 CEO exits recorded in Q1 2023. The second-highest quarter for CEO exits occurred in Q4 2019, when 480 CEO exits were tracked.
WOMEN CEOs
The rate of new CEOs who are women rose from 28.8% in May to 29.6% in June. It is higher than the 26% of new CEOs who were women in the first half of 2022. Meanwhile, women CEOs leaving the top spot is holding at 22%, up from 20% during the corresponding period in 2022. 2023 is seeing more new CEOs who are women than any previous year. Forty percent of the incoming women CEOs are in the Government/Non-Profit sector, while 14% are in Health Care and Hospitals. Another 5% of incoming women CEOs occurred in both Technology and Entertainment/Leisure. Four percent occurred in Consumer Products.
WHERE ARE CEO EXITS HAPPENING?
Government/Non-Profit led last month with 37 CEO exits, with 29 being heads of Non-Profits. The sector has seen a total of 219 exits this year, up 26% from the 174 announced through June last year.
The Technology sector, which has seen the most layoffs for the industry since 2001 according to the latest Challenger Report, followed with 10. For the year, Technology has announced 101 CEO exits, an increase of 26% from the 80 CEO exits recorded through the same period in 2022.
The Health Care/Products sector announced 9 exits last month, followed by Financial firms, which announced 8.
Hospitals have announced a total of 82 CEO changes this year, an increase of 32% from the 62 Hospital CEOs who left their posts during the same period in 2022.
REASONS FOR EXITS
Companies are most often not giving reasons for their CEOs’ departures at 294, up 69% from the 174 who left without reason last year.
Another 208 CEOs retired this year, up 12% from the 185 who retired in the same period last year.
Four CEOs left amid professional misconduct allegations, such as fraud or mismanagement of funds. Challenger did not track any professional misconduct allegations in 2022 and two in 2021. One CEO left due to sexual harassment allegations, the same as in 2022.
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