We examine CEO turnover and succession planning using a unique and highly comprehensive data set from the company exechange. Exechange applies a novel methodology that evaluates the circumstances surrounding a CEO departure to determine the degree to which the turnover event might be voluntary or involuntary (called the Push-Out Score). With this data, we are able to provide new statistics on CEO departures and fresh analysis in three areas of succession planning — sensitivity of turnover to performance, board preparedness to name a successor, and the performance of internal and external successors — to arrive at a more current assessment of the quality of CEO succession planning among publicly traded companies in the U.S.
Copyright held by David F. Larcker, Brian Tayan, and Edward M. Watts. Further inquiries about reproduction and use should be directed to the Corporate Governance Research Initiative.
