| | The next generation CEO is younger, does more for less and doesn’t hang around – but is more likely to stay in the role for longer if he or she is home- grown, according to research from Egremont, the change management consultant.
Egremont has conducted research into the changing face of the CEO, and has made some interesting findings about ‘CEO 2.0’.
Egremont has found that:
- Over the last 10 | |
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| | years, CEO average tenure has dropped from 11.5 to 8.3 years – hitting record lows in 2006;
- CEO turnover is increasing significantly: in 2006, 15% of European CEOs left their job – roughly five times as many as left their position in 1995;
- Over the same period, average age is getting younger: last year, 15% of American CEOs were under 55 – yet in 1995 this was only 8.8%;
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- The average age of CEOs at FTSE 100 companies is now 52 years: between 2004 and 2007 the average dropped by more than a year;
- CEO remuneration has skyrocketed over the past 10 years – however there is no measurable correlation between remuneration and performance (according to a recent Forbes study);
- Over the longer term, home-grown CEOs are more likely to stay | |
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| | longer.
Sean Connolly, director at Egremont, commented: “There are significantly more pressures on chief executives now than 10 years ago. Companies are bigger and chief executives need to lead with more innovation to stay on top – and their profile is changing to reflect this.”
He added: “The most obvious change is age. At HMV Alan Giles retired in his 60s and was replaced by Simon Fox, who is 46. | |
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| | Lord Brown at BP is 58 and his successor, Tony Hayward, is only 49.”
“The behaviours of CEO 2.0 mean that the need to demonstrate improved return on investment becomes ever more acute – chief executives can no longer expect a 20 year innings to deliver on their promises,” concluded Connolly.
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