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17% of large companies' CEOs leave their job within three years, says survey

 


Estadão | September 25, 2019




The Estadão article, "17% of large companies' CEOs leave their job within three years, says survey," quoted Russell Reynolds Associates Consultant Anthony Abbatiello on the importance of succession planning. A translated excerpt of the article is below.

CEO turnover is high in the world and many companies are finding themselves in a delicate situation without a defined succession plan. This perception can be translated into numbers, according to the consulting firm, Russell Reynolds Associates, throughout its study with data from the largest listed companies in the United States. From S&P 500 companies index between 2003 and 2018, 13.1% of CEOs, which were newly in this position during this time, left their jobs in less than three years. The percentage is higher, 17.2%, in the case of external position designation. This data is from the "CEO Transitions - Mitigating Risks and Accelerating Value Creation" survey, which is exclusivity obtained by Broadcast.

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"It's scary to see that more than half of global companies have no structured process of succession and CEO transition. Every company needs to have at least one emergency plan for that issue, to be able to nominate who is likely to be the next leader,” Abbatiello said.

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"The speed of CEO turnover has been higher and, in an environment of economic downturn, we need to act fast," says Abbatiello. In this context, the specialist recalls that in times of crisis, corporations usually retract their investments and wipe their staff, as occurred after major crises in 2002 and 2009, in which he considers many companies got lost in the process. A best practice is to seek alignment of organizational culture with all stakeholders. "Leaders worry too much about the board of directors and institutional investors, but they forget about other touchpoints, such as the sales directors and even the clients."

To read the full article, click here.






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17% of large companies' CEOs leave their job within three years, says survey