Search
Close this search box.
Search
Close this search box.

Respect for Elder CEOs is Increasing as Economy Mends

Older CEOs are staying in their jobs longer, according to new research, indicating that a generational shift that occurred in the wake of the global financial crisis has largely run its course.

The financial services sector most prominently experienced a high level of CEO turnover when the crisis started to bite in 2007 and 2008. High-profile casualties at the time included Citigroup CEO Chuck Prince and Merrill Lynch CEO Stanley O’Neal, who were made accountable for massive losses associated with toxic sub-prime mortgage debt products.

“CEOs in the S&P 500 aged 64 and above had an average turnover rate between 2009 and 2014 of 25.5%, while just 8% of younger CEOs departed each year.”

More indirectly, the crisis had a dramatic impact on company strategies across all industries. Suddenly, boards wanted leaders with skills tailored to running revenue-starved operations more efficiently, rather than boom-time CEOs accustomed to managing rapid growth.

The study by nonprofit peer group The Conference Board found that CEOs in the S&P 500 aged 64 and above had an average turnover rate between 2009 and 2014 of 25.5%, while just 8% of younger CEOs departed each year.

By 2015, however, the older CEOs’ departure rate had shrunk to 15.1%, which is more aligned with the average percentage for the period between 2001 and 2008.

“There are multiple possible explanations for this finding, including, of course, an improvement in firm performance and the overall economy,” report co-author Matteo Tonello said. “But when you see older CEOs departing at a rate of 25% or higher for a number of years in a row, a slowdown becomes natural and signals the completion of a generational change process.”

The study also found that leaders are notching up lengthier tenures, with outgoing CEOs of S&P500 companies in 2015 having served for an average of 10.8 years, compared with 7.2 years in 2009.

Not surprisingly, performance was a key trigger for departures last year, with CEOs overseeing companies with poor shareholder returns having a succession rate of 12.2% in 2015, while better-performing companies had a 9.2% turnover rate.

One-in-10 CEO transitions last year involved an interim appointment, the research found.


MORE LIKE THIS

upcoming events

Roundtable

Strategic Planning Workshop

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:

  1. Lack of systematic approach (70%)
  2. Laundry lists without prioritization (68%)
  3. Decisions based on personalities rather than facts and information (65%)

 

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.

To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

Women in Leadership Seminar and Peer Discussion

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.

To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

Golf Outing

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.

To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.