The 2016 New CEO Report
Feigen Advisors is pleased to release the third edition of our New CEO Report, profiling the 23 new Chief Executives who took the helm of S&P 250 companies in 2016. The report features contributing articles on "Advice to the New CEO" from prominent business and government leaders, including: Mark Fields, the CEO of Ford Motor Company; Mervyn King, the former Governor of the Bank of England; Richard Clarke, former Special Advisor to four United States Presidents; and Doug Hodge, former Chief Executive Officer of PIMCO.
The New CEO Report also analyzes data on the Class of 2016 and from three years of CEO transitions, highlighting illuminating trends from 81 New S&P 250 CEOs since 2014.
Key Findings from the 2016 New CEO Report
23 New CEOs in 2016, 81 New CEOs over the past three years
2016 welcomed 23 new CEOs in the S&P 250. This compares to 29 new CEOs in both 2015 and in 2014. Overall, this is a 32% turnover over the past three years, or 11% per year.
Few Women CEOs
While women make up 25% of senior management according to Catalyst.org, there were just three women appointed to helm S&P 250 companies in 2016, and only six total (representing 7% of new CEOS) from 2014 to 2016. In contrast, eight of the CEOs appointed during this same period were alumni of PepsiCo, showing one company’s ability to produce more leaders than the entire S&P 250 could promote women CEOs.
Few Were Named Chairman on Day one
Less than 9% of the new CEOs were named Chairman at the time they became CEO. Over time, more have been appointed to the Chairman role: 55% of the Class of 2014 became Chairman within two years.
Women Worked Seven Years longer at their Company
Across all three years, the few women promoted into the CEO role averaged nearly 28 years of service at their company, and in most cases, starting at the companies they now lead before the age of 30. Males promoted from within, by comparison, averaged just over 20 years of service at their company.
Promoting Veterans From Within
Over the last three years, nearly nine out of 10 companies appointed their new leader from within their own ranks, a sign of health and stability. New CEOs spent nearly 19 years at their companies on average prior to promotion and have deep expertise and understanding of every aspect of their business, including strategy, operations, capital management, and people.
CEO Tenure is longer than Presumed
The average tenure of a retiring S&P 250 CEO is over nine years, contrary to the commonly-held view that CEO turnover is high. At the top of the S&P 250, stability reigns.