Forced turnovers for ethical lapses rose to 5.3% of all global CEO successions from 3.9% over the last five years, according to consulting firm PwC’s recent Strategy & 2016 CEO Success Study, which notes that the jump represents a 36% increase. While the overall number of forced CEO transitions due to ethical lapses remains relatively small, the fact that the figure is growing bears scrutiny. What’s more, the increase was more dramatic among the largest companies in the U.S. and Western Europe—up by 68% when comparing such successions between 2007 and 2011 (4.6%) to those between 2012 and 2016 (7.8%).
The good news? Rather than more wrongdoing at large companies, PwC attributes these figures to increased public scrutiny of CEOs and their behavior, stricter governance and regulations, the 24/7 news cycle, the ethical risks inherent to doing business in emerging markets and through global supply chains, as well as the increased reliance on digital communications such email, text messaging and social media, which create permanent records of misconduct.
PwC analyzed CEO successions among the top 2,500 public companies worldwide for the study, and defined a forced removal of a CEO as one being the result of a scandal or improper conduct by the CEO or other employees, such as fraud, bribery, insider trading, environmental disasters, inflated résumés and/or sexual indiscretions.
In addition to positing reasons for the bump in forced turnover, the study pointed to several measures companies and their leaders can take to lessen the risk of CEO removals:
Establish a Culture of Integrity. Clearly communicate the company’s values and ensure that every employee understands how they translate to the work they do every day.
Match Your Metrics. Vet the ways in which you evaluate performance to ensure that your company isn’t inadvertently pressuring workers to bypass rules.
Create Controls. Put processes and financial controls in place to help minimize opportunities for unethical behavior.
Chief Executive Group exists to improve the performance of U.S. CEOs, senior executives and public-company directors, helping you grow your companies, build your communities and strengthen society. Learn more at chiefexecutivegroup.com.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
