A few high-profile chief executive officers were replaced last year, but the total number who left came in at its lowest level since 2004. There were 95 CEO departures in December, bringing the full-year total to 1,160, down 7% from 2016’s total of 1,248. Of last year’s departures, 11 were due to allegations of sexual misconduct, up from three in each of the two prior years.
The data were reported Wednesday morning by outplacement firm Challenger, Gray & Christmas. The total number of CEO departures in 2004 was a low 607.
According to the report, 30% (351) of departing CEOs stepped down from their posts into other board or C-suite positions and 320 retired. Another 172 officially resigned from their posts, while 78 found new positions at other companies.
Challenger Gray CEO John Challenger said:
The #MeToo movement, so inspiring to women and men who have endured abuse, particularly at work, also inspired companies. Not only are many companies reevaluating their sexual harassment policies and procedures, but many are operating under a zero-tolerance policy, especially regarding the heads of their organizations. … Companies are more poised than ever to create a safe environment for workers. Cases of sexual misconduct, discussions of which were previously kept in house, if not ignored, are now being openly discussed and exposed. This kind of accountability begins with the person in the top spot.
Challenger highlighted the following data points:
- The Government/Non-Profit sector led all industries in announced departures last year with 191, 18 of which were announced in December. This is 6.4 percent lower than the 204 CEOs who left this sector in 2016.
- Financial companies announced 119 exits in 2017, 23.7 percent lower than the 156 recorded the prior year. Companies in the Services industry saw 110 exits for the year, 162 percent more than the 42 exits in 2016.
- Hospitals saw 107 top leaders exit, 31 percent lower than the 154 announced in 2016. Companies in the Health Care/Products space saw 105 CEO changes in 2017, 21 percent more than the 87 announced in 2016.
- California had the highest number of CEO changes, with a 12-month total of 139, ten in December. Texas followed with 105 departures last year. New York announced 68 CEO changes in 2017, while Florida announced 61.
Including the 11 CEOs who departed last year due to sexual misconduct allegations, another six hit the exits due to an unspecified scandal. In 2016 a total of six CEOs left as a result of scandals, including the three who departed because of sexual misconduct allegations.