108 CEOs Leave Their Posts In September, Led By Health, Financial

Turnover among the nation’s chief executive officers reached a 12-month high, as 108 CEOs announced their departures in September; among them, the heads of tech giants Yahoo! and Hewlett-Packard.   It was the sixth consecutive month with more than 100 CEO changes, according to the latest report on CEO departures released Wednesday by global outplacement firm Challenger, Gray & Christmas, Inc.

September CEO exits were up four percent from 104 in August.  It was the highest number of departures since September 2010, when 111 CEO changes were announced.

Despite the recent uptick in CEO turnover activity, the total number of departures recorded this year remains slightly below the 2010 pace.  So far, Challenger has tracked 922 CEO departures through three quarters of 2011, 4.6 percent fewer than the 967 CEO changes announced from January through September last year.

Health Care saw the heaviest CEO turnover activity last month with 20 announced departures.  This sector has the most CEO departures for the year with 148.  That is down 10 percent from the 165 CEO changes announced by this point last year.

The next closest sector, in terms of CEO changes, is the government and non-profit sector, which has seen 116 chief executives vacate their offices this year, including eight in September.  The financial sector had 13 changes in leadership last month, bringing the year-to-date total for the sector to 96, up from 88 a year ago.

While the health care sector consistently sees the highest number of CEO changes, technology firms lead in terms of having the most blockbuster changes in the executive suite.

These firms announced 11 CEO changes last month, including Leo Apotheker of Hewlett-Packard and Carol Bartz of Yahoo! Inc., both of whom were forced out of the high-profile positions after failing to turnaround the struggling companies.  Apotheker took over the Palo Alto-based computer manufacturer after former CEO Mark Hurd was removed from the company due to a scandal involving an inappropriate relationship and misuses of funds. The company was underwhelmed with Apotheker’s performance during his 11-month stint and hired Meg Whitman, former eBay CEO and gubernatorial candidate to replace him.

Meanwhile, Yahoo! fired Carol Bartz amid falling profits and a shunned takeover bid from Microsoft. She was unceremoniously told of the board’s decision over the phone. CFO Timothy Morse was called upon to replace her.

“Interestingly, while health care providers and government and non-profit agencies continue to see the highest turnover, both have experienced a decline in the number of departures since 2010.  At the same time, CEO turnover has increased in both the tech sector and in financial services.  This is no coincidence.  Until the recent slowdown, tech and finance were the fastest out of the gate as the recession made the transition to recovery,” said Challenger.

“Even with the recent stumbling blocks, these two sectors have their eye on growth and expansion.  Boards are quickly disillusioned with CEOs who are slow to deliver the expected results.  Neither Bartz nor Apotheker were given much time to prove themselves.”

While HP and Yahoo! Inc.’s CEOs were forced out, resignation is the most-often cited reason for CEO departures, with 271 this year, including 26 in September.  Companies have cited retirement 184 times as their leaders’ reasons for leaving.  Additionally, a total of 177 CEOs have “stepped down” this year, which means they no longer hold the CEO title, but remain with the company in some other capacity; typically as a board member or chairman of the board.

Download the report here.

# # #


CHIEF EXECUTIVE DEPARTURES

2011

2010

2009

2008

2007

2006

2005

January

96

89

113

134

114

139

92

February

92

132

82

114

127

112

103

March

99

119

114

123

103

87

129

April

103

101

78

112

126

115

117

May

103

125

115

115

144

148

120

June

113

107

105

126

105

127

120

July

104

88

126

124

88

118

96

August

104

95

101

144

124

114

116

September

108

111

105

140

112

152

121

October

81

89

125

96

122

96

November

79

94

104

132

113

118

December

107

105

123

85

131

94

TOTAL

922

1,234

1,227

1,484

1,356

1,478

1,322

Challenger, Gray & Christmas, Inc.©

 

 

 

CHIEF EXECUTIVE DEPARTURES

Public vs. Private

  September

2011 Y-T-D

2010 Year-End Total

Private

73

697

956

Public

35

225

278

 

 

 

 

 

 

Copyright 2011 Challenger, Gray & Christmas, Inc.


 

 

CEO DEPARTURES

By Industry

 

INDUSTRY

10-Sep

YTD 2010

11-Sep

YTD 2011

Health Care/Products

23

165

20

148

Government/Non-Profit

13

132

8

116

Financial

7

88

13

96

Computer

10

70

11

88

Energy

7

48

9

45

Pharmaceutical

4

41

7

43

Services

6

53

2

42

Entertainment/Leisure

8

48

5

39

Electronics

2

38

3

36

Legal

0

3

36

Industrial Goods

5

21

1

27

Consumer Products

9

2

26

Retail

24

3

24

Telecommunications

3

25

2

21

Automotive

2

17

18

Utility

1

11

3

17

Real Estate

3

23

3

16

Aerospace/Defense

3

2

15

Insurance

5

22

1

15

Transportation

2

30

3

14

Food

3

22

1

11

Apparel

1

5

2

8

Construction

1

16

2

8

Chemical

6

1

6

Commodities

6

1

4

Media

5

44

3

 TOTAL

111

967

108

922

 

 

 

Copyright 2011 Challenger, Gray & Christmas, Inc.


CEO DEPARTURES

By Reason

September

Year-To-Date

Resigned

26

271

Retired

25

184

Step Down

18

177

New position in another company

11

97

Interim Period Ended

14

74

Acquisition/Merger

4

29

Another position within company

3

28

Removed

0

15

Died

0

10

Ousted

5

9

Scandal

1

9

Health

1

8

Pressure From Board

0

4

Economic Conditions

0

3

Bankruptcy

0

2

Position Eliminated

0

1

Government Regulation

0

1

 

CEO DEPARTURES

Average Age, Tenure

 

Age

Tenure

2011

2010

2011

2010

January

 60.8

59

 7.6

8.9

February

 61.7

61.5

 9.6

8.8

March

 60.0

59.2

 7.4

8

April

 63.2

62.1

 8.1

9.5

May

 55.7

63.9

  7.1

8.5

June

 62.4

63.1

 8.1

 9.6

July

 56.0

55.8

 11.9

8.6

August

 59.4

61.8

 7.3

8.3

September

 64.7

 51.5

 5.1

 8.0

October

 58.0

9.4

November

62.3

7

December

58.7

 7.2

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