NEW YORK–Credit unions aren’t alone in struggling with gender balance in leadership positions. According to newly released data, the number of women CEOs in the S&P 500 dropped by nearly 20% in 2018.
Meanwhile, at the same time, the same large companies also ousted five CEOs in 2018 due to #MeToo-related misconduct, representing more than 40% of all CEO dismissals.
The findings were released in a report published by The Conference Board, supported by Heidrick & Struggles. The study examines CEO succession events announced in the S&P 500 in 2018, comparing historical data that The Conference Board has been collecting since 2001.
Among the key findings:
Number of Women CEOs Declines by Nearly 20%
- At the end of 2018, women held 22 CEO positions in the S&P 500, down from a record 27 in 2017.
- In 2018, just one additional woman joined the CEO ranks: Kathy Warden of Northrop Grumman.
Insiders Claim Almost All Vacant Positions
- Insiders assumed nearly 90% of the open CEO positions in 2018 (52 out of 59 openings).
- Of the 52 insiders who became CEOs, 20 of them had at least two decades of experience at the company. This reflects the value that boards place on continuity and in-depth organizational knowledge when selecting a leader, the study said.
Long Tenures Continue
- In 2018, departing CEOs had stayed in their roles for an average of 10 years.
- After hitting a low of nearly seven years following the Great Recession, CEO tenure has increased almost every year over the past decade. It reached the 10-year mark in three of the past four years.
CEO Firings Reach a Historic High
- Nonvoluntary departures climbed to 30.5%, up almost eight percentage points from 2017.
- #MeToo-related oustings accounted for nearly half (five) of the 12 dismissals, compared to just one CEO departure for personal misconduct in the S&P 500 from 2013-17.
“The rate of succession among older chief executives continues to climb, and there are still more CEOs aged 75 and over than there are CEOs under the age of 45,” said Matteo Tonello, managing director of ESG Research at The Conference Board’s ESG Center and the principal author of the report. “In the coming months and years, a softening economic environment may very well unfold. Boards should be prepared, given a slowdown would likely spur an acceleration of CEO retirements and tightening of the market for top talent.”