CEOs are resigning at record rates, and the small proportion of women at the top are leaving the fastest.
The number of global CEOs peaked in the first quarter of 2024, with 52 departures and 68 new appointments among companies listed in global stock indexes such as the S&P 500, FTSE 100 and others. That’s according to the latest quarterly revenue index from Russell Reynolds Associates, a leadership consulting firm.
What the analysis calls “failed CEO appointments,” or CEOs who lasted less than two years, accounted for 15% of departing CEOs at the start of 2024. But turnover rates are worse for women.
Influential women are the ones who leave the fastest
According to RRA data dating back to 2018, around one in four female CEOs, or 24%, leave their role within two years. This is more than double the share of 10% of men who leave their CEO role during this period. With an even shorter time frame, female CEOs are four times more likely than men to leave their roles within a year.
The numbers are “surprising and disappointing,” says Ty Wiggins, CEO and head of the executive transition practice at Russell Reynolds Associates, and author of “The New CEO.”
“Our underlying concern is: Are women being given a poisoned chalice in terms of inheriting a failing company, or are they being placed in roles where their chances of success are much lower?” he says.
Some management experts call this the “glass cliff,” suggesting that women and people from underrepresented groups are promoted to leadership positions during difficult times, setting them up for failure.
The first 12 to 24 months are especially crucial for a new CEO, Wiggins says, because that’s when he sets a new agenda, builds his management team and must demonstrate that his changes have had a positive impact on the company.
But tough economic cycles in recent years have put pressure on companies and their CEOs, Wiggins says. Their companies’ boards, for their part, have adopted “stronger positions by responding more quickly to market pressure”, notably by firing CEOs who cannot demonstrate a significant positive impact during their second year, he said.
Women CEOs, in particular, are judged more harshly when things go wrong, Wiggins says. A female client recently told her she felt she had to work twice as hard to get the same support as a male counterpart.
“There’s pressure to perform, deliver and be almost perfect,” Wiggins says.
In the business world, according to data from LeanIn.org and McKinsey & Company, senior women are resigning at some of the highest rates ever recorded, citing challenges such as microaggressions, promotion gaps, and take responsibility for diversity and inclusion initiatives.
88 years for gender parity among global CEOs
As for the 68 new CEOs appointed at the start of 2024, only five are women. For the whole of 2023, only 22 women (or 12%) were newly appointed CEOs, compared to 156 men appointed to this position.
At the current rate, it would take 88 years to achieve global parity in leadership representation.
“It’s a very disappointing statistic,” Wiggins says. “We hope this will highlight to boards and organizations that there is a chasm in terms of success rates among female CEOs.”
Wiggins says corporate boards need to do a better job of helping women move into and keep women in leadership positions.
A first step is to recognize that women have different responsibilities in the workplace and at home, which could harm their path to leadership. “Organizations need to create an environment that recognizes this and meets individuals where they are” to develop, promote and protect women leaders, Wiggins says.
New CEOs often lose confidence in the changes they’re making after 6 to 9 months, Wiggins adds, and “boards have a real role to play in supporting a CEO through that” by assessing realistic expectations and providing advice.
Boards themselves show slightly higher gender parity, with women making up 32% of global boards in the same indices covered by the Global CEO Turnover Index. But progress is slow and hampered: in the United States, for example, California courts have struck down two state laws that would require greater diversity on public company boards.
There’s plenty of room for improvement, Wiggins says: “We can be confident that things aren’t that bad and that we’re doing a better job as a business community (at achieving gender parity), but We haven’t gotten there yet.”
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