PAGE
8
1,
1,
1,
1,
1,
AS OF NOV. 2019
1,
2010 2019
CEO DEPARTURES, YEARLY
SOURCE: CHALLENGER GRAY & CHRISTMAS
14
FORTUNE.COM // JANUARY 2020
Hamm, for example,
stayed on as chairman.
But that doesn’t
fully explain the surge
in CEO turnover.
“It’s surprising,” says
Andrew Challenger of
Challenger Gray. “It
doesn’t jibe with what
we’ve seen historically,
but in some ways, it’s a
tight labor market for
CEOs too.” One clue
is that more replace-
ments are coming from
outside candidates, not
in-house. “This means
companies are saying,
‘We don’t have the insti-
tutional knowledge to
do this. We need to go
out into the market and
find new talent.’ ”
That trend is evident
in the ever-evolving tech
industry, where CEO
exits have increased
45% this year. And
shifting consumer tastes
have roiled the retail,
food, apparel, and en-
tertainment industries:
Together, they saw CEO
departures rise 63%.
When Nike CEO Mark
Parker stepped down in
October, the company
tapped John Donahoe,
formerly of eBay, to
oversee a new push into
e-commerce.
Unhappy shareholders
made their voices heard
this year too. Oker-
strom left after clashing
with Expedia’s board
and its chairman Barry
Diller; eBay’s Devin
Wenig, meanwhile,
departed under pres-
sure from activist hedge
funds. And 35 CEOs left
under a cloud, whether
because of résumé
padding (Samsonite),
regulatory backlash
(Juul), or inappropriate
behavior (McDonald’s).
Most notably, WeWork’s
board pressured Adam
Neumann to step down
in an effort to salvage a
troubled IPO.
But the fact that
more CEOs are leaving
because of bad behav-
ior doesn’t necessar-
ily mean leadership
is declining. “There’s
always been misconduct
among CEOs,” says
Challenger. “But today
it’s being looked at un-
der a microscope.”
The Year of the
CEO Exodus
The seat in the corner office has never felt
so hot. In 2019, with the jobless rate
sitting at a 50-year low, a record number
of CEOs left their high-paying jobs.
By Kevin Kelleher
CEO DEPARTURES
through November
rose 12% year-on-year
to 1,480, according to
executive outplacement
firm Challenger Gray
& Christmas. That was
only four exits shy of the
record set in 2008, dur-
ing the turmoil of the
global financial crisis.
Since November, five
more prominent chiefs
have left their jobs:
Alphabet’s Larry Page,
United’s Oscar Munoz,
Expedia’s Mark Oker-
strom, Harold Hamm of
oil producer Continental
Resources, and Steph
Korey of Away, a trendy
luggage company.
But unlike 2008, this
isn’t a period of eco-
nomic turbulence. Peri-
ods of booming stocks
allow successful CEOs
to hand over the reins
without spooking inves-
tors. Alphabet’s Page—
along with cofounder
and president Sergey
Brin, who also stepped
down— exemplifies this
kind of smooth transi-
tion. All told, 36% of
departing CEOs transi-
tioned to another senior
role at the company.
Adam Neumann
Steph Korey
Oscar Munoz
Larry Page
“COMPANIES ARE
SAYING, ‘ WE
DON’T HAVE THE
INSTITUTIONAL
KNOWLEDGE TO DO
THIS. WE NEED TO
GO OUT INTO THE
MARKET AND FIND
NEW TALENT.’ ”
NEUM
ANN: PETER PRATO
—THE NEW
YORK TIM
ES
/REDUX; PAGE: DAVID PAUL M
ORRIS/BLOOM
BERG VIA GET T Y IM
AGES: KOREY: JARED SISKIN
—PATRICK M
CM
ULL AN VIA GET T Y IM
AGES; M
UNOZ: SAUL LOEB
—AFP VIA GET T Y IM
AGES
