CEO Appointment Surge In The First Half 2021

A report by Heidrick and Struggles, an international executive search firm based in Chicago, found that CEO appointments in the first half of 2021 were the highest going back to 2018.

Looking at CEO appointments in 24 markets compared to previous appointments, CEOs are more likely to be women, from countries outside of a company’s headquarters, have cross-border experience, and have advanced degrees. These trends are good indicators of future CEO appointments in a post-pandemic world.

The report took 1,095 CEOs at the largest publicly listed companies as of July 5, 2021, including in the U.S., looking at how the pandemic affected CEO succession planning and how expectations may have changed from the previous appointments.

Trends of note are that there were more internal hires, and, though there was an increase in CEO appointments who are women, the number of women in leadership roles still pales when compared to men.

Another main finding was an increase in CEOs appointed in the first half of 2021 that had earlier experience beyond Chief Financial Officer (CFO) or Chief Operating Officer (COO). The report notes that typically CEOs are hired when their experiences include CFO or COO, noted by trends seen within the last year, but that seems to have changed with appointments in the past six months.

CEOs appointed in this period also had experience in roles such as Chief Risk Officer, Chief Strategy Officer, and Chief Technology Officer, particularly the head of division roles represented 41% of the newly appointed CEOs. The number of CFO to CEO appointments took a notable dip.

CEOs also now need a broad range of experience, beyond just daily running business. They are in the spotlight, with their every decision scrutinized by the world. The report suggests that the push for fresh perspectives and diversity across companies comes from both internal pressure and laws about diversity and hiring in corporate environments.

Scandal-hit video game giant Activision Blizzard's CEO has pledged changes Photo: AFP / DAVID MCNEW

It is expected that when the pandemic brought global economies to a screeching halt in 2020, a dramatic increase in 2021 is not surprising. Still, the hiring trends seen because of the reported six-month surge in hires and the post-pandemic world could set the stage for the future of CEO successions around the world.

A combination of research from Heidrick and Struggles leads them to conclude that “there are four capabilities in which future-ready leaders consistently excel: leading through influence, driving execution, creating new thinking, and having an ownership mindset.”