Business Insider Asks Cowen Partners About CEO Succession
As more CEOs call it quits, it could get harder for companies to find the next superstar leaders.
A mix of sometimes poor succession planning, a tendency by some young go-getters to job hop rather than rise through the ranks, and a thinning of middle management could cause headaches for companies trying to find a new chief, corporate observers told Business Insider.
Because of a “collapse of the leadership pipeline” at many organizations, the pool of candidates ready to step in and lead is often lacking, Shawn Cole, president and founding partner at the executive search firm Cowen Partners, told BI.
That’s in part because some companies have been busy pulverizing the organizational layers that once served as C-suite farm teams.
“The middle-management, VP-level successors are just gutted right now.” — Shawn Cole, Cowen Partners President & Founder
It comes as more chiefs are peeling their nameplate from the C-suite door — and, in some cases, as boards are making them.
Nearly halfway through 2025, the number of CEO changes for S&P 500 companies is on pace to reach 14.8% for the year, according to data from The Conference Board and ESGAUGE. That would be the highest rate of turnover in data going back to 2001. The average over the same period is 11.3%.
In the first three months of the year, a record 646 US CEOs left their roles, according to Challenger, Gray & Christmas. That followed a busy 2024, when the number of departing chiefs rose to the highest annual level since the staffing and coaching firm began keeping tabs on CEO turnover in 2002.
Companies Want Leaders with Better Ideas
Cole said his firm is getting calls from boards and private equity firms looking to change directions with a new CEO. He said there’s often a desire for visionary leaders who can think up the next great product or service to boost business.
“They’re like, ‘Holy sh—, we need some better ideas in the room.” — Cole on Boards and PE firms
Normally, when corporate overseers want to make a change at the top, or are forced to, they can scan the org chart. Yet, he said, some up-and-comers have tired of riding the bench.
“You’ve got upper management that’s held on too long, and so what would have been your successor has now left the company.” — Cole
At the same time, he said, because many companies haven’t invested in grooming the next generation, it’s not always possible to simply poach a hotshot from a rival.
“The musical chairs is broken.” — Cole
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