July CEO turnover increases
August 9, 2017
• Up 7.3 percent from June
• “The statue of the ‘fearless girl’ on Wall Street is a commentary on issues concerning workplace diversity”
The number of chief executive officers who announced their departures continued to rise last month, with 102 CEOs leaving their posts in July, according to data compiled by the outplacement firm Challenger, Gray & Christmas Inc.
That is a 7.3 percent increase compared to June’s exits, and a 10.9 percent increase over the 92 CEOs who left their posts in July of last year, according to Challenger.
However, while July boasted a noticeable increase in exits, the total number of CEOs who have left their posts so far in 2017 is just 669, which is 6.6 percent fewer than the 716 CEOs who left by the end of July 2016. The trend of fewer CEO exits in 2017 was consistent throughout the majority of industries surveyed, with only commodities, food, industrial goods, insurance, pharmaceuticals, retail, and transportation losing more this year than last.
So far, says Challenger, the government/non-profit sector experienced the most turnover in its top posts this year, with 99 CEO changes, 23 of which occurred in July. This is 14.6 percent fewer announced departures this year than through the same period last year, when 116 were announced.
Hospitals around the country are also turning over a large number of leadership positions, with 69 chief executive departures this year, but this is still 21.6 percent fewer than the 88 announced through July last year, according to the report Wednesday. The financial and services sectors each announced 63 CEO changes so far this year, and health care/products companies have experienced 54 changes in the first six months of 2017.
These turnovers come from states all across the country. However, as of July, California leads all states in CEO departures this year, with 83, followed by Texas, where 72 CEO changes have occurred. New York has seen 40 changes in July. Companies in Florida have announced 35 CEO departures and Illinois 34 through the year.
There are many reasons why CEOs leave their posts, but most who have left this year cited stepping down into other positions within the company, with 216 CEOs stepping down, 176 announcing retirement, and another 113 resigning so far this year. Of the 176 CEOs who announced retirement, 27 of them retired last month alone.
This month, 17 female CEOs left their positions. Notable within this group is Mondelez’s Irene Rosenfeld, one of only 32 women who head fortune 500 companies. She is stepping down, but will remain on the board after a tenure of nearly 19 years at Kraft and then Mondelez.
“Women make up only 6.2 percent of CEOs at Fortune 500 companies. There is mounting pressure to move more women into top leadership positions. The statue of the ‘fearless girl’ on Wall Street is a commentary on issues concerning workplace diversity. Having Rosenfeld step down means one less woman represented in leadership,” says John Challenger, chief executive officer of Challenger, Gray & Christmas.