CEOs Are Exiting Their Posts in Record Numbers

C-suite shake-ups are set to hit a record high in 2019, according to a new report.

Challenger, Gray & Christmas Inc. reports that 172 chief executives exited their positions at companies across a range of U.S. industries in October 2019 — up 15% from October 2018 and 14% from this September. While the majority of CEOs (35) left posts last month in the government and nonprofit sectors, the study said, the retail sector experienced a 57% increase in the number of CEO departures, and exits were down 30% in the consumer products category.

The business and executive coaching firm said 1,332 CEOs have left their posts so far in 2019, the highest number of shake-ups recorded from January to October since tracking began in 2002.

In the athletic space, October saw the announced departures of two high-profile CEOs: Nike’s Mark Parker and Under Armour’s Kevin Plank. Both leaders will remain at their respective companies in the roles of executive chairman after exiting their CEOs posts in January.

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John Donahoe, the current president and CEO of ServiceNow Inc. and chairman of PayPal Holdings, will take Parker’s place in the top spot at Nike. While the Beaverton, Ore. company positioned the transition as a natural move to amp up digital-focused efforts, some insiders speculated that controversy surrounding allegations of harassment and a toxic work environment for women, as well as the “wind down” of the Nike Oregon Project following the four-year doping-related ban of head coach Alberto Salazar, might play a role.

At Under Armour, Plank will be replaced by President and COO Patrik Frisk, with the transition coming amid concerns about UA’s workplace culture and growth strategy. Two weeks after the exit announcement, the brand confirmed it was under federal investigation related to its accounting procedures.

Also in October, there was executive turnover in the top spots at Sequential Brands Group, where CEO Karen Murray’s replacement has yet to be named; at Walmart U.S., with John Furner replacing Greg Foran as CEO; and at Chloé, where Geoffroy de la Bourdonnaye was replaced by Riccardo Bellini.

In the fashion space, September marked a big month of shakeups, too. Tapestry Inc. replaced CEO Victor Luis with Jide Zeitlin, an exec who has more than a decade of experience on the company’s board. Also in September, eBay president and CEO Devin Wenig left the company, Giuseppe Zanotti named Eugenio Manghi its CEO and Gap Inc. appointed Mary Beth Laughton as president and CEO.

Andrew Challenger, VP of Challenger, Gray & Christmas, said that while some October exits came for “various missteps,” most came “amid normal succession plans.”

“After a decade of expansion, companies that started 10 years ago are finding themselves in a phase where new leadership is needed,” he added. “Other companies are adapting to changing technologies or finding new leadership based on current economic conditions and forecasts for the coming year.”

Just as November began, there had already been one high-profile exit: Amid Barneys New York’s bankruptcy woes and Authentic Brands Group’s plans to liquidate most of the retailer’s outposts, Barneys CEO and president Daniella Vitale resigned Nov. 1 in a letter to employees.

Overall, “the number of chief executive changes is higher than at any point on record,” the study stated. “At this point during the Great Recession in 2008, the second-highest year for CEO turnover, 1,257 chief executives had announced exits, 6% lower than the current year-to-date total.”

Challenger’s study looked at CEO changes at companies of at least 10 employees across all industries that have been in business for two or more years.

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