Executive-Level Turnover Down in January

 
 
By Deb Perelman  |  Posted 2007-02-06 Email Print this article Print
 
 
 
 
 
 
 

Early 2007 has seen a significant slowdown in highest-level executive turnover compared to 2006, while notable changes in power, such as at Dell, are poised to have a longstanding impact on investments, according a new report.

Early 2007 showed a significant slowdown in the turnover of C-level, or highest-level, executives compared to 2006, according to a report issued on Feb. 6 by Liberum, a New York-based management research firm.

Executive level turnover declined 16 percent in January 2007, compared to 12 months ago. Among CEOs, this change was 20 percent; it was 19 percent for chief financial officers and 14 percent for board of directors.
In all categories, the slowdown first appeared in the fourth quarter of 2006, which had notably lower turnover than the last quarter of 2005. Overall, C-level change declined 6 percent in Q4 2006, while CEO turnover slipped 11 percent and CFO fell by 20 percent.
Still, the report asserts that overall level of management-echelon change remains high, something attributed to increasing competition between domestic and international companies and growing complexities of business and work. In addition, increasing government regulations such as Sarbanes-Oxley, along with growing shareholder activism and increased independence of many corporate boards are seen as conditions that have led to a sustained high level of turnover.
Sarbanes-Oxley, in particular, has been considered burdensome, especially by large companies, leading to many higher-profile executive changes. Generation X may struggle to fill baby boomers shoes. Click here to read more. There were a grand total of 2,240 C-level management changes in January 2007, according to the report. Among those changes, there were 236 in banking, 194 in drugs and biotech, and 132 in business services. Forty-three percent were new hires from outside the firm; 29 percent were promoted from within the firm; 14 percent were internal moves; and another 14 percent were the result of resignations or retirements from the firm. Just 1 percent, or 12 individuals, left their firms without clear explanations. A total 233 CEO positions, 186 chief financial officer positions and 502 board of director positions changed hands in January 2007, predominantly in the area of banking. Of these, Dells Jan. 31 CEO change is considered worthy of a second look, as it could have a significant effect on investors. Check out eWEEK.coms for the latest news, analysis and commentary on careers for IT professionals.
 
 
 
 
 
 
 
 
 
 
 

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