FTSE 100 CEO appointments reach five-year high as one in ten CEO appointments fail within two years

• Global CEO appointments spike with the FTSE 100 welcoming eight new CEOs in Q1
• More than a tenth (10.9%) of global CEO appointments fail within crucial first 24-month period
• Worldwide, almost a quarter of women CEO appointments fail within two years, more than twice the rate of men

April 22nd, London – Global CEO turnover spiked in Q1 this year with the highest first quarter CEO appointments (68) recorded in the last five years. The surge comes amidst a challenging senior talent market, impacting the ability of new CEOs to build strong leadership teams.

While other global indices experienced higher-than-average turnover, the FTSE 100 stands out amongst global peers, according to data from the quarterly Russell Reynolds Associates (RRA) Global CEO Turnover Index. FTSE 100 businesses saw six departures and eight appointments, the highest single-quarter movement (14) in the period covered by the index¹.

The research highlights the pressure new CEOs will find themselves under worldwide as they seek to survive their crucial first 24 months in role. Globally, the first quarter of 2024 has seen 15.1% of CEOs leave their role after less than two years, up from an average of 9.6% since 2019. With boards under pressure to improve performance in a tough macroeconomic context, many are willing to remove underperforming CEOs more quickly.

The high rate of turnover, and a tight talent market, will increase competition for senior leadership. As these newly appointed CEOs seek to make their mark on their business, the selection of and bedding in of their top teams will play a significant role in the success of these efforts.

Ty Wiggins, CEO & Executive Transition Practice Lead at Russell Reynolds Associates, and author of ‘The New CEO’, commented:

“One of the first challenges a new CEO must tackle is appointing the right senior leadership team. Boards and CEOs consistently underestimate the time and effort required to get this right.

“Even the most efficient new CEOs this quarter will find themselves still trying to put together a high-performing senior leadership team well into 2025, a factor that will have an enormous impact on their ability to deliver. A tight senior talent market will only put further strain on this timeline, leaving businesses that haven’t developed a strong bench of internal talent in a tough spot. This reality will force boards to reframe their expectation of an incoming CEO’s ability to perform in the short term.”

Women CEOs overrepresented in failed appointments

Analysis of failed appointments by gender worldwide shows that women CEOs are more than twice as likely to leave their roles within this crucial 24-month period than men. Almost a quarter (24.1%) of women CEOs left their role within 24 months of appointment over the last five years, compared with 10.2% of men. The finding poses serious questions about whether boards are doing enough to set up women CEOs to succeed.

Commenting on the figures Ty Wiggins said:

“The reality that a quarter of women CEOs find themselves out of the role within two years is deeply concerning, especially given how few women CEOs there are worldwide. Boards cannot ignore their accountability for a new CEO’s success, and many are clearly not doing enough to set women candidates up to succeed. 

“A failed CEO appointment can be devastating to a business. The loss of direction and momentum it creates can set back businesses years and cause permanent cultural and reputational damage. Boards must do better to ensure that the CEO roles offered to women are not a poisoned chalice.”

_{¹Russell Reynolds Associates’ Global Index of CEO Turnover tracks CEO departures since 2018 from constituent companies of the following global stock indices: ASX 200, CAC 40, DAX 40, Euronext 100, FTSE 100, FTSE 250, HANG SENG, Nikkei 225, NSE Nifty 50, S&P 500, S&P/TSX Composite, and STI. More data and analysis can be found at the dedicated Global Index of CEO Turnover section of the Russell Reynolds website at: https://www.russellreynolds.com/en/insights/reports-surveys/global-ceo-turnover-index}