CEO departures at U.S. companies hit a record this year
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Clockwise from top: Former Boeing CEO Dave Calhoun (CNBC), Starbucks former CEO Laxman Narasimhan (Getty Images), former Nike CEO John Donahoe (Reuters), former Intel CEO Pat Gelsinger (Getty Images) TL: CNBC | TR: Getty Images | BL: Reuters | BR: Getty Images Retired, ousted or poached, CEOs headed for the exits this year. U.S. public companies announced 327 chief executive changes this year through November, according to outplacement firm Challenger, Gray & Christmas. That’s more than in any other year since at least 2010, when the firm first started tracking the turnover. It’s also an 8.6% increase from last year. Turnover included CEOs at U.S. companies that have long dominated their industries — like Boeing, Nike and Starbucks. The pace of change points to those companies’ customers, investors, hedge funds or boards growing impatient with sales slumps or strategic missteps in an otherwise strong economy when consumers proved they were willing to spend. CEO changes slowed during the pandemic, when companies were suddenly faced with lockdowns, remote work, supply chain difficulties and shortages, if not outright survival. They later faced higher borrowing costs, inflation, labor shortages, shifting consumer preferences and other challenges. Over the past 14 years, 2021 had the lowest number of replacements at 197. “The cost of capital, the speed of transformation, is creating faster turnover,” said Clarke Murphy, managing director and former chief executive of Russell Reynolds Associates, a leadership advisory firm. Murphy said it was easier to stand out for poor performance in an otherwise strong market. “In years of 20-plus-percent S&P [500] returns two years in a row, any company that’s significantly underperforming, the spotlight has been on, and boards of directors moved faster than they might have moved five or seven years ago,” Murphy said. Consumer-focused companies, which are more susceptible to changing tastes…
Filed under: News - @ December 20, 2024 1:29 pm