Why CEO turnover is on the rise

Financial Post

Turnover among Canadian CEOs and their American counterparts has been on the rise since 2010, and reached a new high of almost 15% in 2013. While renewal at the very top can indicate tighter corporate governance and oversight, and the replacement of the CEO often leads to increases in share value at least in the short term, there are significant costs involved. When CEOs are removed for poor performance, severance pay as well as normal recruitment costs come into play. It also represents a significant disruption for management, especially for the 50% of Canadian businesses with no formal CEO succession plan.

A number of factors contribute to this increase in CEO turnover, according to Fred Jacques, a professor at Calgary’s Haskayne School of Business and an expert in organizational behaviour and leadership. One reason for change that he’s seen more of in recent years is extremely personal: a re-evaluation of…

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About Jim Rose

Utopia - you are standing in it promotes a classical liberal view of the world and champion the mass flourishing of humanity through capitalism and the rule of law. The origin of the blog is explained in the first blog post at https://utopiayouarestandinginit.wordpress.com/2014/03/12/why-call-my-blog-utopia-you-are-standing-in-it/

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