The dot com sector again proved to be the most volatile for CEO and CFO turnover. Of the 63 CEO changes in April, 19 were from dot coms. Dot com CFOs also led all other industries with 13, or 18% of the 71 departures announced during the month.
The disproportionate number of departures coming from this young industry may help explain why, of those companies identifying length of service, the average tenure among departing chief executives in April was just over 36 months. The average tenure for CFOs was 5.3 years, according to a report released today by Challenger, Gray & Christmas, Inc., an international outplacement firm.
The report also found that weak earnings reports may be taking an increasingly heavy toll on CFOs, whose 71 departures in April actually outpaced those of CEOs.
CEO departures fell to 63 in April, the lowest figure since April, 2000, when 54 departures were announced. April exits were down 28% from the March total of 88. It was the second consecutive month in which CEO departure announcements declined and the second time since July, 2000, that CEO departures did not exceed 100.
So far this year, 389 CEOs have left their posts. Since August, 1999, when Challenger began tracking CEO exits, 1,701 chief executive departures have been recorded.
Departures of CFOs also fell slightly in April, dropping 6.6% from 76 in March to 71 in April, the second month that firm tracked CFO exits.
It is significant that departing CFOs outnumbered CEOs. It could be a sign that, during the slowdown, companies are putting greater emphasis on how money is managed as opposed to how the company is managed. The mounting pressure on CFOs to hold the financial line may be too much and may be resulting in more voluntary and involuntary departures, said John A. Challenger, CEO of Challenger, Gray & Christmas Inc.
However, the declining number of CEO departures should be seen as good news for the economy, since it is an indication that companies will retain some stability of leadership during this period of uncertainty.
Network
