Published October 29, 2024
The number of CEO changes at U.S. companies rose slightly to 202 in September from 200 one month prior. It is up 23% from 164 CEO exits recorded in the same month last year, according to a report released Tuesday by global outplacement and business and executive coaching firm Challenger, Gray & Christmas, Inc.
Source: Challenger, Gray & Christmas, Inc.
In the third quarter, 551 CEOs left their posts, the highest total of any quarter. It marks a 6% increase from the previous record of 518 CEO exits in the third quarter of last year. It is up 15% from the 479 CEO exits recorded one quarter prior.
So far this year, 1,652 CEOs have announced their departures, the highest year-to-date total on record, since Challenger began tracking CEO changes in 2002. It is up 16% from 1,425 exits that occurred during the same period last year, which was the previous year-to-date record.
“Organizations face increasing pressure to adapt and leverage technological advancements while the upcoming election will most certainly change the regulatory landscape. Leadership transitions reflect the mounting need for fresh perspectives to navigate this change,” said Andrew Challenger, Senior Vice President of Challenger, Gray & Christmas, Inc.
Women CEOs
The rate of new CEOs who are women rose 0.1 percentage points to 27.3% in September. It is down from the 29.0% of incoming CEOs who were women during the same period last year.
“The rate of women ascending to the CEO role has stalled to fewer than one-third of new CEOs. Companies have reportedly slowed their diversity and equity initiatives, while structural bias often keeps women and people of color out of the leadership pipelines,” said Challenger.
Where are CEO Exits Happening?
Government/Non-Profits led all industries last month with 45 exits, 39 of which occurred in Non-Profits. This is up from 29 exits one month prior, 27 of whom were CEOs of Non-Profits. For the year, 356 CEOs have left Government/Non-Profit entities, up from 353 who left these posts through September 2023.
Healthcare/Products companies, which include medical supply and other device manufacturers, but excludes Hospitals, also saw 34 CEO exits last month for a total of 186. This is up 48% from the 126 CEO exits recorded during the same period last year.
Technology announced 21 CEO exits last month for a total of 174 for the year, an increase of 23% from the 141 exits recorded through September 2023.
Consumer Products manufacturers announced 12 CEO changes in September for a total of 62, up 68% from the 37 CEO exits in these companies through the same period last year.
The Automotive sector, which includes Automakers and parts suppliers and manufacturers, has announced 21 CEO changes, up 75% from the 12 CEO exits announced during the same period last year.
“Manufacturers are facing extreme disruption by automation and AI. Automakers and suppliers are seeing growing demand for electric vehicles, which means, in many cases, determining how and when to pivot,” said Challenger.
Reasons for Exits
This year, 459 CEOs stepped down into other C-level, advisory, or Board roles. Another 426 CEOs left companies without giving a reason, while 366 CEOs retired from their companies.
Source: Challenger, Gray & Christmas, Inc.
Eighteen CEOs left due to mergers and acquisitions, while 6 CEOs left due to allegations of professional misconduct.
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