CEO TransiTiOns 2016 - Spencer Stuart/media/s/research and...CEO TransiTiOns 2016 2016 CEO TransiTiOns 1. CEO transitiOn OvErviEw Fifty-eight S&P 500 companies ... Pharma Midwest John

Each year, Spencer Stuart tracks CEO transitions among

S&P 500 companies. These transitions can be part of a

planned succession or can arise unexpectedly, the result

of company performance or personal issues. In addition

to cataloging the reasons for CEO departures, based

on company reporting, we also examine information

about the successors, including whether or not they

are internal candidates and whether they have been

appointed chairman of the board in addition to CEO.

CEO TransiTiOns2016

2016 CEO TransiTiOns 1

CEO transitiOn OvErviEwFifty-eight S&P 500 companies installed a new chief executive in 2016, the highest number of transitions since 2007 and 14 percent more than the 51 transitions in 2015. Since 2006, when S&P 500 companies installed 60 new CEOs, the number of transitions generally declined, hitting a low of 37 in 2012 before increasing again.

20162015201420132012201120102009200820072006

5851525337494346545860

S&P 500 CEO Transitions 2006 - 2016

401-50017%

301-40033%

201-30026%

101-20014%

1-10010%

Percentage of Transitions* by S&P 500 Company Range

*Percentages are rounded up

The largest S&P 500 companies — the top 100 by revenue — were least likely to experience a CEO transition in 2016, while the majority of transitions occurred at companies in the mid revenue ranges.


why dO CEOs lEavE?The vast majority — 88% — of CEO transitions occurred because the former CEO retired or stepped down, according to company reports. This represents an increase from 2015, when CEOs retiring or stepping down drove 82% of transitions.

CEO prOfilEs The average age of the outgoing CEOs was 60, while the average age of the incoming CEOs was 53, the same as in 2015. Departing CEOs were slightly older in 2015, averaging 62 years old. Four of the new CEOs, 7%, are women, while only one of the departing CEOs is female.

Reasons for CEO Transitions

Former CEO retired or stepped down

Former CEO ousted or resigned under pressure

Company merger

88%

09%

03%

0

60average age of outgoing CEOs 53average age of incoming CEOs


ExtErnal vs. intErnal CandidatEsNinety percent (52) of the new CEOs were promoted from within the company, the highest percentage in the past 10 years. All but eight of them were the result of a planned succession.

An analysis of three four-year periods since 2005 confirms that S&P 500 companies are increasingly likely to promote CEOs from within rather than hire from outside; 80% of new CEOs named between 2013 and 2016 were promoted from within.

2016201520142013201220112010200920082007200620052004

Internal External

50% 100%0%

10 %

16 %

19 %

25%

27 %

22 %

23 %

26%

19 %

21 %

23 %

34%

34%

90 %

84 %

81 %

75%

73 %

78 %

77 %

74%

81 %

79 %

77 %

66%

66%

CEO Successors: Internal vs. External Placements

2013-2016(214 companies)

80%2%1%6%11%

2009-2012(175 companies)

69%3%3%7%18%

2005-2008(239 companies)

67%4%4%6%19%

InternalInsider-Outsider*

Former ExecutiveFrom BoardExternal

New CEO Backgrounds

Note: Percentages are rounded up* “Insider-outsiders” were hired from outside the company and promoted to the CEO role within 18 months.


split vs. sharEd Chairman and CEO rOlEsOnly four of the CEOs, 7%, were also named chairman of the board, a decrease from 14% last year. Sixty percent of the outgoing CEOs stayed on to serve as board chair, compared with 49% in 2015.

Split RoleCombined CEO & Chairman

2009

89 %

11 %

2010

70 %

30 %

2011

80 %

20 %

2012

89 %

11 %

2013

94 %

6 %

2014

87 %

13 %

2016

93%

7%

2015

86 %

14 %

100%

50%

0%

Is the New CEO Also the Chairman?

93%of companies chose to divide the roles of chief executive and board chair

60%of outgoing CEOs continued with the company in the role of chairman


Note: This data looks at the companies that have experienced a CEO transition, as defined by the replacement of an outgoing CEO with a permanent CEO. Data includes names of incoming and outgoing CEOs; the reason for the new appointment/departure of the former CEO; the ages of both the outgoing and incoming CEO; and whether the appointment was an internal or external one. Prior to 2010, Spencer Stuart tracked CEO turnover, defined and recorded as any change in the CEO post. As of Jan. 1, 2010, we adjusted our methodology to track CEO transitions, defined as the change from a permanent outgoing CEO to a permanent incoming CEO. Open cases of turnover, defined as cases where no permanent CEO has been appointed, or cases where interim CEOs serve less than one year, are not included in year-end transition totals.

For information about copying, distributing and displaying this work, contact [email protected].


mailto:[email protected]

S&P 500 Company Industry Region New CEONew CEO

Age New CEO Start DateName of Interim

CEO (if applicable)

Reason for change PlacementIf Internal, Planned

Succession?

Prior Public CEO?

Former CEOFormer CEO

AgeCEO/Chair

Split?Former CEO Now Chair?

300-400 AGL Resources ID: Energy South Andrew W. (Drew) Evans

49 January 1, 2016 Former CEO retired Internal Yes No John W. Somerhalder II

60 Yes No

200-300 Baxter International Inc. LS: Healthcare Services Midwest José E. (Joe) Almeida 53 January 1, 2016 Former CEO retired External Yes Robert L. Parkinson 65 No No

200-300 Broadcom Limited TCM: Semiconductors Pacific Hock E. Tan 65 February 1, 2016

Avago Technologies aquired Broadcom

Corporation, forming Broadcom Limited

Internal Yes Yes Scott A. McGregor 60 Yes Yes

200-300 Celgene Corporation LS: Pharmaceuticals Mid-Atlantic Mark J. Alles 56 (est.) March 1, 2016 Former CEO retired Internal Yes No Robert J. (Bob) Hugin

61 Yes Yes, already was

400-500 Church & Dwight Co. Inc. CGS: Packaged/Durables Mid-Atlantic Matthew T. (Matt) Farrell

59 January 4, 2016 Former CEO retired Internal Yes No James R. Craigie 62 Yes Yes, already was

400-500 Citrix Systems TCM: Software/Services South Kirill Tatarinov 51 January 25, 2016 Robert M. Calderoni

Former CEO retired External No Mark B. Templeton 62 Yes Yes, already was

300-400 Fastenal Company ID: Machinery/Electric Midwest Daniel L. Florness 51 January 1, 2016 Former CEO retired Internal No No Willard D. (Will) Oberton


0-100 Gilead Sciences Inc. LS: Pharmaceuticals Pacific John F. Milligan 55 March 10, 2016 Former CEO retired Internal Yes No John C. Martin 64 Yes Yes, already was

400-500 Kimco Realty Corporation FS: Real Estate Mid-Atlantic Conor C. Flynn 36 January 1, 2016 Former CEO retired Internal Yes No David B. Henry 66 Yes No

300-400 Leggett & Platt, Incorporated

CGS: Packaged/Durables Mid-West Karl G. Glassman 56 January 1, 2016 Former CEO retired Internal Yes No David S. Haffner 63 Yes No

300-400 McCormick & Company, Incorporated

CGS: Packaged/Durables Mid-Atlantic Lawrence E. Kurzius 58 February 1, 2016 Former CEO retired Internal Yes No Alan D. Wilson 58 Yes Yes, already was

300-400 Owens-Illinois CGS: Packaged/Durables Midwest Andres A. Lopez 54 January 1, 2016 Former CEO retired Internal Yes No Albert P.L. (Al) Stroucken


200-300 Quanta Services, Inc. ID: Professional Services Southwest Earl "Duke" Austin, Jr. 46 March 14, 2016 Former CEO retired Internal Yes No James F. (Jim) O'Neil III

58 Yes No

400-500 Southwestern Energy Company

ID: Energy Southwest William J. (Bill) Way 57 January 6, 2016 Former CEO retired Internal Yes No Steven L. (Steve) Mueller

64 Yes Yes

300-400 St. Jude Medical Inc. LS: Healthcare Services Mid-West Michael T. Rousseau 60 January 1, 2016 Former CEO retired Internal Yes No Daniel J. Starks 61 Yes Yes, already was

300-400 T. Rowe Price Group, Inc. FS: Banking Mid-Atlantic William J. (Bill) Stromberg

55 January 1, 2016 Former CEO retired Internal Yes No James A.C. (Jim) Kennedy

62 Yes No

200-300 The Sherwin-Williams Company

CGS: Retail Midwest John G. Morikis 52 January 1, 2016 Former CEO retired Internal Yes No Christopher M. (Chris) Connor


0-100 The TJX Companies, Inc. CGS: Retail New England Ernie Herrman 55 January 31, 2016 Former CEO retired Internal Yes No Carol M. Meyrowitz 61 Yes Yes, already was

S&P500 Company Industry Region New CEONew CEO


CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair

Split?Former CEO New Chair?

200-300 Advance Auto Parts Inc. CGS: Retail/Distributor South George E. Sherman (INTERIM)

54 January 3, 2016 George Sherman

Former CEO stepped down

Internal No No Darren R. Jackson 51 Yes No

200-300 Level 3 Communications, Inc.

TCM: Communications West Sunit S. Patel (INTERIM)

54 February 24, 2016 Sunit S. Patel Health Internal No No Jeffrey K. (Jeff) Storey

55 Yes No

Additions: Willis

Towers Watson

Extra Space StorageFederal Realty

TrustCitizens Financial

GroupConcho

ResourcesAmerican

Water Works UDR HologicPepco

Holdings

Deletions:Fossil Group Chubb Broadcom Precision Castparts

Plum Creek Timber

CONSOL Energy

Keurig Green

MountainCentene Ensco

2016 S&P 500 CEO TransitionsTotal Number of Transitions: 58

Noted "Interim" Cases for Q1 (not factored into quarterly count)

Total Q1: 18

Changes to S&P 500 Index in Q1 2016

Q1 2016 Transitions



CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


400-500 Skyworks Solutions, Inc. TCM: Semiconductors New England Liam K. Griffin 49 May 11, 2016 Former CEO retired Internal Yes No David J. Aldrich 59 Yes Yes, already was

400-500 Teradata Corporation TCM: Software/Services Midwest Victor L. Lund 68 May 5, 2016Former CEO stepped

down, effective immediately

From Board No Michael F. Koehler 63 Yes No

0-100 Express Scripts Holding Company

LS: Healthcare Services Midwest Timothy C. (Tim) Wentworth

56 May 4, 2016 Former CEO retired Internal Yes No George Paz 60 Yes Yes, already was

300-400 Perrigo Company plc LS: Pharma Midwest John T. Hendrickson 53 April 24, 2016 Former CEO resigned

Internal No No Joseph C. Papa 60 Yes No

100-200 Genuine Parts Company ID: Auto South Paul D. Donahue 59 May 1, 2016 Former CEO retired Internal Yes No Thomas C. Gallagher


200-300 WEC Energy Group, Inc. ID: Energy Midwest Allen L. Leverett 49 May 1, 2016 Former CEO retired Internal Yes No Gale E. Klappa 65 Yes Yes

200-300 Eversource Energy ID: Machinery/Electric New England James J. (Jim) Judge 60 May 4, 2016 Former CEO retired Internal Yes No Thomas J. (Tom) May


300-400 Ametek, Inc. ID: Machinery/Electric Mid-Atlantic David A. Zapico 51 May 5, 2016 Former CEO retired Internal Yes No Frank S. Hermance 67 Yes Yes, already was

100-200 Eaton Corporation ID: Machinery/Electric Midwest Craig Arnold 55 June 1, 2016 Former CEO retired Internal Yes No Alexander M. (Sandy) Cutler

65 No No

200-300 Occidental Petroleum Corporation

ID: Energy Southwest Vicki A. Hollub 56 April 29, 2016 Former CEO retired Internal Yes No Stephen I. Chazen 69 Yes No

0-100 Delta Air Lines, Inc. ID: Aero/Defense South Edward H. (Ed) Bastian

58 May 2, 2016 Former CEO retired Internal Yes No Richard H. Anderson 60 Yes Yes

200-300 The J.M. Smucker Company

CGS: Packaged/Durables Midwest Mark T. Smucker 46 May 1, 2016 Former CEO retired Internal Yes No Richard K. Smucker 68 Yes Yes

300-400 Avery Dennison Corporation

ID: Materials West Mitchell R. Butier 44 May 1, 2016 Former CEO retired Internal Yes No Dean A. Scarborough

60 Yes Yes

300-400 Crown Castle International Corporation

FS: Real Estate Southwest Jay A. Brown 43 June 1, 2016 Former CEO retired Internal Yes No W. Benjamin (Ben) Moreland

52 Yes Yes

200-300 Advance Auto Parts, Inc. CGS: Retail/Distributor South Thomas R. (Tom) Greco

57 April 11, 2016 George E. Sherman

Former CEO stepped down

External No Darren R. Jackson 51 Yes No



CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


200-300 Priceline Group, Inc. CGS: Hospitality/Leisure New EnglandJeffery H. Boyd

(INTERIM) 59 April 28, 2016 Jeffery H. BoydFormer CEO

resigned, effective immediately

Internal No Yes Darren R. Huston 50 No No

100-200 Staples, Inc. CGS: Retail New England Shira D. Goodman (INTERIM)

55 June 14, 2016 Shira D. Goodman

Former CEO stepped down, by mutual

agreement with the Board

Internal No No Ronald L. Sargent 60 Yes Yes, already was

Additions: Alliant Energy Albemarle

Fortune Brands Home & Security

TransDigm Group Arthur J Gallagher & Co.

LKQ Digital Realty Trust

Alaska Air Global Payments

Acuity BrandsUlta Salon,

Cosmetics & Fragrances

Foot Locker

Deletions: AGL Resources TECO Energy Cablevision Systems

Baxalta Coca-Cola Enterprises

Airgas Time Warner Cable

SanDisk GameStop ADT Corporation Tenet Healthcare

Cameron International

Q2 2016 TransitionsTotal Q2: 15





CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


300-400 Symantec Corporation TCM: Software/Services West Gregory S. (Greg) Clark

51 August 1, 2016

Symantec acquired Blue Coat, and Blue Coat CEO becomes

Symantec CEO

External Yes Michael A. Brown 57 Yes No

100-200CarMax, Inc.

CGS: Retail/DistributorMid-Atlantic William D. (Bill) Nash 47

February 1, 2016Former CEO retired Internal Yes No

Thomas J. (Tom) Folliard 51 Yes Yes

300-400 FMC Technologies ID: Energy Southwest Douglas J. Pferdehirt 52 September 1, 2016 Former CEO retired Internal Yes No John T. Gremp 64 Yes Yes, already was

200-300 PulteGroup CGS: Packaged/Durables South Ryan R. Marshall 41 February 15, 2016 Former CEO retired Internal Yes No Richard J. Dugas, Jr. 50 Yes Yes, already was

400-500 E*TRADE Financial Corporation

FS: Banking Mid-Atlantic Karl A. Roessner 48 September 12, 2016 Former CEO ousted Internal No No Paul T. Idzik 55 Yes No

100-200 Staples, Inc. CGS: Retail New England Shira D. Goodman 55 September 26, 2016 Shira D. Goodman

Former CEO stepped down, by mutual

agreement with the Board

Internal No No Ronald L. Sargent 60 Yes Yes

100-200 Progressive Corporation FS: Insurance Midwest Susan P. (Tricia) Griffith

52 July 1, 2016 Former CEO retired Internal Yes No Glenn M. Renwick 61 Yes Yes, already was

300-400 Rockwell Automation, Inc. ID: Machinery/Electric Midwest Blake D. Moret 53 July 1, 2016 Former CEO retired Internal Yes No Keith D. Nosbusch 65 Yes Yes, already was

200-300 Edison International ID: Energy West Pedro J. Pizarro 50 September 30, 2016Former CEO reached

retirement age Internal Yes NoTheodore F. Craver,

Jr. 65 No No

300-400 First Solar, Inc. ID: Energy Southwest Mark R. Widmar 50 July 1, 2016 Former CEO retired Internal Yes No James A. (Jim) Hughes

53 Yes No

400-500 Illumina, Inc. LS: Biotech/Medtech West Francis A. deSouza 45 July 5, 2016 Former CEO retired Internal Yes No Jay T. Flatley 63 Yes Yes, already was

400-500 Kansas City Southern ID: Transport/Logistics Midwest Patrick J. Ottensmeyer

59 July 1, 2016 Former CEO retired Internal Yes No David L. Starling 67 Yes No

300-400 CMS Energy ID: Energy Midwest Patricia K. (Patti) Poppe

47 July 1, 2016 Former CEO retired Internal Yes No John G. Russell 58 Yes Yes

300-400 Endo International LS: Pharma Mid-Atlantic Paul V. Campanelli 54 September 23, 2016 Former CEO stepped down

Internal No No Rajiv De Silva 49 Yes No

200-300 Stanley Black & Decker ID: Machinery/Electric New England James M. (Jim) Loree 58 August 1, 2016Former CEO reached

retirement age Internal Yes No John F. Lundgren 64 YesYes, already

was



CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


100-200 Viacom, Inc. TCM: Media Mid-AtlanticThomas E. (Tom) Dooley (INTERIM) 59 August 19, 2016

Thomas E. Dooley

Former CEO resigned, effective

immediatelyInternal No No Philippe P. Dauman 62 Yes No

400-500 HCP, Inc. FS: Real Estate West Michael D. McKee (INTERIM)

70 July 11, 2016 Michael D. McKee

Former CEO resigned

From Board No No Lauralee Martin 65 No No

Additions: Fortive Mettler-ToledoCharter

CommunicationsThe Cooper Companies Coty

Deletions:Columbia Pipeline Group

Johnson Controls EMCStarwood Hotels & Resorts Worldwide

Diamond Offshore Drilling



Total Q3: 15Q3 2016 Transitions



CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


400-500 CME Group, Inc. FS: Banking Midwest Terrence A. (Terry) Duffy

58 November 15, 2016 Former CEO retired Internal No No Phupinder S. Gill 55 No No

300-400 Coty, Inc. CGS: Packaged/Durables New England Camillo Pane 46 October 3, 2016 Lambertus J. (Bart) Becht

Former CEO resigned

Insider-Outsider

No Michele Scannavini 57 Yes Yes, already was

300-400 Hanesbrands, Inc. CGS: Retail Southeast Gerald W. Evans, Jr. 57 October 1, 2016 Former CEO retired Internal Yes NoRichard A. (Rich)

Noll 58 YesYes, already

was

200-300 Hormel Foods Corporation

CGS: Packaged/Durables Midwest James P. Snee 49 October 31, 2016 Former CEO retired Internal Yes No Jeffrey M. Ettinger 58 Yes Yes, already was

0-100 Tyson Foods, Inc. CGS: Packaged/Durables Southwest Thomas P. (Tom) Hayes

51 December 31, 2016 Former CEO retired Internal Yes No Donald J. (Donnie) Smith

57 Yes No

100-200 Viacom, Inc. TCM: Media New England Robert M. (Bob) Bakish

53 December 12, 2016 Thomas E. (Tom) Dooley

Former CEO resigned

Internal No No Philippe P. Dauman 62 Yes No

100-200 Visa, Inc. TCM: Technology West Alfred F. (Al) Kelly, Jr. 58 December 1, 2016 Former CEO resigned

From Board No Charles W. (Charlie) Scharf

51 Yes No

200-300 W. W. Grainger, Inc. ID: Machinery/Electric Midwest Donald G. (DG) Macpherson

48 October 1, 2016 Former CEO retired Internal Yes No James T. (Jim) Ryan 58 Yes Yes, already was

100-200 Waste Management, Inc. ID: Transport/Logistics SouthwestJames C. (Jim) Fish,

Jr. 54 November 10, 2016 Former CEO retired Internal Yes No David P. Steiner 56 Yes No

0-100 Wells Fargo & Company FS: Banking West Timothy J. Sloan 56 October 12, 2016 Former CEO retired Internal No No John F. Stumpf 63 Yes No



CEO (if applicable)


Succession?

Prior Public CEO?


AgeCEO/Chair


400-500Alexion Pharmaceuticals,

Inc. LS: Biotech/Medtech New EnglandDavid R. (Dave)

Brennan (INTERIM) 62 December 12, 2016David R. (Dave)

BrennanFormer CEO stepped

down From Board Yes David L. Hallal 50 Yes No

Additions: Mid-America Apartment

Communities

Envision Healthcare Holdings

Deletions: Owens-Illinois Legg Mason


Q4 2016 TransitionsTotal Q4: 10


Documents

CEO TransiTiOns 2016 - Spencer Stuart/media/s/research and...CEO TransiTiOns 2016 2016 CEO TransiTiOns 1. CEO transitiOn OvErviEw Fifty-eight S&P 500 companies ... Pharma Midwest John