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#business #ceo #career

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Within the last six months the CEOs of Nestle, Boeing, Starbucks, Peleton, Paramount, Zillow, Amazon Web Services, Snowflake, Hertz, HSBC Grayscale, Under Armor, Papa Johns and Discover have all stepped down (voluntarily or otherwise) from the top job.

Collectively these men controlled companies with TRILLIONS of dollars in annual revenue and now… they are all gone.

These were just the BIG names too… CEO turnover in companies of all sizes is now higher than it has been since the start of the pandemic which begs the question, why is this happening?... and why is it happening now?...

Chief Executives and other c-suite executives are just employees like any other which means eventually they either quit, get fired or die in their jobs.

CEO layoffs HAVE spiked but maybe that’s not too surprising considering layoffs in A LOT of industries have also spiked. But this is actually NOT normally how it goes.

If you ever find yourself in the top job at a major company, you should know that your position is simultaneously far more secure and far more fickle than the average rank and file employee working under you.

As a CEO your position is unique because there is no other employee at the company with the authority to fire you, the only people that can do that are the board of directors who themselves are representatives of the shareholders.

During periods of uncertainty, the last thing that companies want to do is switch up senior leadership unexpectedly because that signals to the market that something is not right which could tank the stock price.

Since the board of directors represent the shareholders and individual directors usually ARE major shareholders themselves, they have an incentive to avoid doing anything that could hurt the stock price unnecessarily.

For this reason, CEO’s are rarely fired outright and are instead offered generous exit packages to “step down” amicably in a way that won’t scare investors in the business.

Outside of high-profile cases where the business has CLEARLY been mismanaged or in casews where the CEO has made VERY unpopular decisions, it can be hard to tell if outgoing CEO’s have been pushed out or are simply retiring.

According to Fortune Magazine itself the average age of a fortune 500 CEO is FIFTY SEVEN years old, and their average compensation package was sixteen point three MILLION dollars.

If you are THAT old and have THAT much money, it’s not unthinkable that you would want to retire or pursue less intense roles more suited to your old age… like political office…

But if CEO exits are treated so seriously and secretively, why has there been such a big spike all of a sudden?