With Emerging Economies on the Rise, 2010 CEO Turnover Falls Sharply

New analysis of corporate management models shows CEOs more deeply involved with operations see shorter tenures, according to Booz & Company's Global CEO Succession Study


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New York — May 25, 2011 — Booz & Company





strategy+business



Asian economies are becoming the new center of gravity.

China is a major, but not sole, reason for declining CEO exit rates. Ken Favaro

"Insider CEOs" rule the roost.

CEO tenures have shortened over the past 10 years.

Long-term trends in governance still hold.

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  • Holding company. With a minimal degree of operational management, interacts like a portfolio manager and is interested in results, not how the results are generated.
  • Strategic management company. Offers strategic guidance to its local businesses, but not the supervision of operational decision-making and finds value in linkages and synergies between loosely related business units.
  • Active management company. Shares accountability with the business units for major operational decisions and adds value through close guidance and expertise.
  • Operationally involved company. Sets the strategy for the company as a whole and gets involved in operational decision making for most or all business units.









Gary Neilson



  • The energy sector saw the highest level of overall CEO turnover in 2010 at a rate of 16.3 percent, well above the global turnover rate. Materials and telecommunications followed at 14.8 percent and 13.9 percent, respectively. The lowest succession rates were in the consumer discretionary (7.2 percent) and consumer staples (7.7 percent) sectors.
  • Energy companies also claimed the highest forced CEO turnover rate among the sectors studied at 6.2 percent, a sharp increase over 2009. Healthcare CEOs were also dismissed at a much higher rate than the prior year — from only 0.6 percent in 2009 to 4.2 percent last year.
  • Conversely, financial services companies collectively saw among the sharpest decreases in forced departure rates, from 5.2 percent in 2009 to just 2.1 percent last year. Dismissals within the industrials sector also declined significantly to a rate of just 0.5 percent.

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