January 15, 2021
The Harvard Law School Forum on Corporate Governance published today findings from the analysis of CEO succession announcements tracked by ESGAUGE across the Russell 3000 and S&P 500 indexes. ESGAUGE has compiled the most comprehensive historical dataset on the subject, with 18 years of historical information for the S&P 500 index.
The post was authored by Matteo Tonello of The Conference Board and Jason Schloetzer of the McDonough School of Business at Georgetown University, with whom ESGAUGE is collaborating. Search firm Heidrick & Struggles also contributed to the project as a knowledge partner.
CEO succession is one of the most consequential events a company may face, with possible profound effects on its strategy, its organizational culture, and its relationship with investors and other stakeholders. Therefore, it is not entirely surprising to find that, when the COVID-19 crisis suddenly disrupted business activities in the United States in mid-March 2020, some companies chose to avoid compounding existing business risks with the inevitable uncertainties of a leadership turnover. Our data show that, while the Russell 3000 CEO succession rate for the first quarter of 2020 was substantially similar to those recorded for the same periods of 2018 and 2019, it dropped significantly in the second quarter. Specifically, in the April 1–June 30, 2020 period, Russell 3000 companies counted only 71 CEO succession announcements—a decline of 11.3 percent from the average number of 80 CEO turnovers reported in the second quarters of 2018 and 2019.
Read the article at https://bit.ly/3acNgla
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