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The inaugural Global CEO Turnover Index Annual Report for 2023 provides valuable insights into the evolving landscape of CEO leadership, with implications for businesses in 2024 and beyond at public companies.
The COVID-19 pandemic significantly influenced CEO turnover trends, causing a decline in departures during 2020 and 2021.
A five-year high global CEO turnover
However, as the world moved past the pandemic in 2022, global CEO turnover reached a five-year high at 11.2%, indicating a resurgence of risk appetite among organizations.
Women CEOs have shorter tenure
The report underscores a gender disparity in CEO tenures, revealing that women CEOs have shorter average tenures (5.0 years) compared to their male counterparts (8.0 years).
The variation is striking across different indices, with women CEOs in the NSE Nifty 50 (India) surpassing men in tenure, while the gaps widen in the CAC 40 (France), S&P 500 (US), and FTSE 100 (UK).
Despite increasing representation, women remain underrepresented in the CEO role, constituting only 12% of new CEO appointments in 2023.
94% of internally appointed CEOs are first-timers
Internally appointed CEOs continue to dominate, comprising 77% of new appointments in 2023. These CEOs enjoy a 1.4-year longer tenure on average compared to externally appointed counterparts.
Furthermore, the majority (88%) of newly appointed CEOs are ‘first-timers,’ with 94% of internally appointed CEOs falling into this category.
First-time CEOs enjoy a longer tenure
First-time public company CEOs, whether male or female, experience a 2.1-year longer tenure on average than their experienced counterparts.
Take-away
The 2023 Global CEO Turnover Index highlights the impact of the COVID-19 pandemic on CEO turnover, gender disparities in leadership roles, and the prevalence of first-time CEOs at public companies.
