2005: The crest of the wave

Global turnover of CEOs set a record in 2005, with more than one in seven of the world’s largest public companies making a change in leadership — compared with only one in 11 a decade earlier. In addition, four times as many of the world’s top CEOs were forced out in 2005 as in 1995. Ten years earlier, the CEO’s job was all about “stewardship” of the corporation’s assets for stakeholders; in 2005, it was all about the bottom line for investors.

The 2005 study focused on the desirability of hiring an experienced CEO; considered the best background for the chairman of the board; and examined when to hire — and when to fire — an outsider chief executive. The study provided quantitative data concerning the impact of alternative governance arrangements on share values, and it suggested which characteristics of potential CEOs are most likely to increase a company’s effectiveness.

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Chuck Lucier, Paul Kocourek, and Rolf Habbel
Half of all chief executives are dismissed from office, but those who can deliver results are in greater demand than ever.read more on strategy+business >


Past studies