Retail Industry's CEO Turnover Rate Hits Record High
The retail industry saw its rate of announced CEO changes among S&P 500 companies rise to nearly 23 percent last year, from 16 percent, according to the Conference Board’s annual study "CEO Succession Practices," developed in partnership with the executive search firm Heidrick & Struggles. That was the highest rate the sector has seen since the Conference Board began the study in 2001, and more than double the industry's historical average rate of 10.5 percent. The retail CEO turnover rate last year also topped that of other industries (e.g., finance, transportation), and doubled the S&P 500 index average of 10.8 percent, according to the 116-page report.
Total Retail's Take: Much like the impatient, want-it-now customers their businesses are serving, who have made same-day delivery a thing, retail board members aren't willing to wait long for the CEOs they employ to prove themselves. Trying to satisfy the demands of shareholders, boards of directors are giving CEOs little leeway to generate positive returns. If they don't, they won't be around for long. Retail has long been an industry with a high employee turnover rate, but that was mostly due to transient store associates and warehouse workers, not C-suite executives at corporate headquarters. That has changed. Retail executives are under immense pressure to evolve their businesses to better compete in a disrupted industry, one that sees Amazon.com continuing to grow market share.