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NO MORE EXECUTIVE TENURE

Chances that a CEO will be leaving his or her piece of work this year? They're about the same as everyone else's, according to a Booz Allen Hamilton application of mind While the typical employee turnover rate in the United States is 12 percent (excluding layoffs and temporary employees) CEO turnover rates are single slightly lower, at 11.7 percent Also, the increase in CEO turnovers has been enormous in the last 10 years-300 percent since 1995 Overall, 142 percent of CEO at the world's 2500 largest companies left office last year, compared with 98 percent the year before.

And a CEO is better not upon if he stays on this side of the pond CEO give permission to go at European companies held their piece of works for an average of 25 years, compared to 52 years for advantageed U.S. executives. And in 42 percent of European dismissals, performance (as oppos to merger or planned retirements) is the cited reason for dismissal, compared with 31 percent in the United States.

Overall, the reasons for firing CEO were related to underperformance more than any other factor. The investigation also found that it's hard to blame performance upon the pressures of the Sarbanes-OxleyAct-dismissal rates be- fore and after Sarbanes were at the same horizontals And, somewhat counterintuitively, a company that performed well before hiring their CEO was more likely to fire him or her than was a poorly performing company-one-third more likely, in fact.



In 2004 industries with the highest rates of turnover (for all reasons, including retirement, merger and dismissals by means of the board) were the industrial sector at 195 percent followed through utilities at 19.0 percent. Between 1995 and 2004 telecommunications companies had the highest turnover rate (127 percent) followed by the agency of industrials (12.3 percent), energy (117 percent) and utilities (116 percent)

But according to the research the energy industry was considered the safest for CEO in 2004 with a forced succession rate of 103 percent for the whole year. For the last 10 years, financial services companies take pleasure ined the lowest overall CEO turnover rate, at 86 percent

Copyright Edison Electric Institute Sep/Oct 2005

Provided by dint of ProQuest Information and Learning Company. All rights Reserved



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