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CEO Turnover Reaches Record High in Third Quarter of 2023

The number of CEO changes at U.S. companies reached its highest quarterly total on record in the third quarter.

The third quarter of 2023 witnessed 518 CEO departures, global outplacement and career transitioning firm Challenger, Gray & Christmas said in a Thursday (Oct. 19) press release. This figure reflects a 166% increase from the third quarter of 2022 and a 5.9% increase from the previous quarter.

Andrew Challenger, senior vice president of Challenger, Gray & Christmas, attributed this surge in CEO turnover to companies preparing for upcoming economic changes. With rising labor costs and interest rates, organizations are seeking new leaders to navigate these challenges effectively.

The company reported that 164 CEOs left their positions in September alone, marking a 4.5% increase from the previous month and a 122% increase compared to the same month last year.

In the first nine months of this year, a total of 1,425 CEOs departed from their roles, representing a 47% increase from the same period in 2022, according to the release. This figure is the highest recorded in the first three quarters of the year since the firm began tracking CEO turnover in 2002.

When examining the sectors experiencing CEO exits, the government/nonprofit sector had the highest number of departures in September, with 28 CEOs leaving their posts, the report said. This sector has seen a total of 353 CEO exits this year, an 86% increase from the same period in 2022.

Hospitals announced the second-highest number of CEO changes in September, with 24 departures, per the report. Overall, hospitals have announced 125 CEO changes through September, a 67% increase from last year.

The services industry also witnessed significant CEO turnover, with 15 departures in September and a total of 40 for the year, representing a 90% increase from 2022, according to the report. Technology saw 12 CEO exits in September, bringing the total for the year to 141, making it the second-highest industry for CEO turnover. This figure represents a 45% increase compared to the same period last year.

Challenger, Gray & Christmas also shed light on the reasons behind CEO departures. Retirement remains a common reason for CEO departures, accounting for 318 exits during the first nine months of the year. Additionally, 241 CEOs stepped down and moved into other C-level, advisory or board roles.

A growing share of companies are not providing reasons for their CEOs’ exits, accounting for 31% of all CEO departures, up from 24% in the same period last year, according to the press release.

In one CEO change announced in September, treasury and finance solutions firm Kyriba appointed tech executive Melissa Di Donato as its new chair and CEO, succeeding Jean-Luc Robert, who stepped down as CEO and joined the company’s board of directors.