Average tenure among the top brass reached 9.8 years in December 2003, up from an average stay in office of 7.1 years the year before (See Fewer CEO Exits in 2002, More Hires from “Inside” ), according to a data supplied by outsourcing firm Challenger, Gray & Christmas, Inc.
The increased tenure could be a reaction to more focus being placed on corporate governance, Challenger CEO John Challenger hypothesizes. ” The fact that CEOs are staying in their positions longer than a year ago and that an increased number are leaving on their own terms could be unintended results from the many corporate governance measures instituted over the last 24 months.”
Even though CEOs may be staying longer, roughly the same number of their brethren is streaming for the exits.Companies announced 67 CEO departures in December, up from 64 in December 2002. However, unlike 2002’s turnover at the top, in December of 2003, it was retirement that claimed most chiefs. In fact, the 26 that announced retirements were more than doubled the number of retirements from a year ago. The average age of departed CEOs was 59.3.
After retirement, resignations accounted for 15 departures, followed by five each that found another position within the company and stepped down and one exit chalked up each to another position elsewhere, death, ouster, replacement or incarceration. Eleven companies did not give a reason for their CEOs exit, down from the 26 that were mum in December 2002.
Challenger also announced the resumption of CEO tracking reports after a year-long hiatus. The CEO tracking report will now be issued on a quarterly basis.