11 Dec. 2017 | Comments (0)
Departing CEO tenure in 2016 was nine years, but five percent of S&P 500 companies are led by CEOs with tenures of 20 years or longer.
In 2009, at the peak of the financial crisis, the average CEO of an S&P 500 company held the position for 7.2 years, the shortest average tenure registered by The Conference Board and down from the 11.3 years found in 2002. However, departing CEO tenure in these large companies started to rebound soon after, rising to 8.4 years in 2011, 9.7 in 2013, 9.9 in 2014, and 10.8 in 2015. (In 2015, the number was partly skewed by Rupert Murdoch of media empire 21st Century Fox, who left his post after a 36-year tenure).
In 2016, departing CEO tenure was nine years, close to the 8.9-year average reported by The Conference Board since 2001. Several factors, including stricter board oversight practices introduced after the Enron scandal and the public scrutiny over pay for performance, may help explain the decline in CEO tenure observed in the 2003–2010 period. The slight reversal of the trend that started in 2011 is likely due to improved economic conditions as well as the natural deceleration of the generational change that a decade of shorter tenure data had been signaling.
The longest-tenured CEOs currently serving at S&P 500 companies include Leslie H. Wexner of fashion retailer L Brands Inc. (who has been on the job for 54 years), Warren Buffett of Berkshire Hathaway (47 years), and Alan Miller of hospital management company Universal Health Services (39 years). With a 21-year tenure, Jeff Bezos of Amazon.com also made the list of longest-serving CEOs.
CEO Succession Practices: 2017 Edition and the full Corporate Intelligence portfolio are complimentary to members of The Conference Board and The Conference Board Governance Center. A fee may apply to non-members. (To learn more about our member benefits, email us at email@example.com.)
The study was made possible by a research grant from executive search and leadership advisory firm Heidrick & Struggles.