CEO turnover skyrocketed in the first half of 2021 as companies turned to new talent to navigate the aftermath of the pandemic in COVID-19 and the CEO stressed out they sought a career change, according to a study by recruiting firm Heidrick & Struggles.
The findings illustrate how CEOs are not immune from the burnout that has swept away hundreds of millions of workers around the world since the onset of the pandemic and pushed many to consider a new job or lifestyle, in a wave called the “Great Renunciation.”
“We think it will accelerate into next year as people have delayed their retirement,” said Heidrick’s Jeff Sanders.
In the first half of 2021, there were 103 CEO appointments from 1,095 companies in 24 regions that Heidrick studied, including the United States, China and some European countries. Six months earlier, in the second half of 2020, 49 companies changed CEOs, according to the study.
Most companies kept their leaders in place last year, closing ranks to meet the challenges of the pandemic. However, as it gave way with the help of vaccines, the companies felt stable enough to find a new leader, Sanders said.
“A lot of CEOs didn’t have to travel as much,” which helped preserve their energy, Sanders said. But communicating “virtually” in a new medium was “exhausting,” he noted.
The reluctance of many boards to physically meet with CEO candidates or place risky bets with external candidates during the pandemic favored internal applicants, according to the study. Nearly two-thirds of the new CEOs were internal candidates, up from just over half during the same period in 2020.
Women accounted for 13% of new CEOs in the first half of this year, up from 6% in the previous period in the regions studied by the report.
However, there were no big strides in diversity, according to the study, which found that 3% of Fortune 100 CEOs are black, 4% are Hispanic or Latino, 4% are Asian, and 1% are from the East. Middle or North Africa, below its share of the US population.
“I don’t think (CEO diversity) is where it should be,” Sanders said.
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