CEO
The Great Resignation Hits The C-Suite The pandemic-induced “Great Resignation,” which was found most common among mid-career workers, according to an analysis published by Harvard Business Review, is increasingly reverberating among C-Suite executives, confirming the phenomenon— also known as the “Great Reshuffle”—has no exception, even as CEO pay surged back from 2020 declines. New data by global outplacement services firm, Challenger Gray & Christmas, shows that CEO exits in U.S. companies spiked to a record during the first four months of 2022, with a total of 518 departures, an increase of 18% higher compared to the same period in the previous year. It was the highest CEO turnover that the company has recorded for the JanuaryApril period since it began tracking CEO exits two decades ago . According to Andrew Challenger, Senior VP at Challenger Gray & Christmas, the changes in the top-level position reflect the companies’ recalibration to address rising costs for business and consumers. Inflation, staffing shortages, and fears of looming recession are also factors triggering companies to reevaluate their leadership, Challenger explains. Beyond the effects of economic challenges on CEO turnovers, however, Challenger notes in an earlier report that burnout is the main motivator for workers, including CEOs, to quit their jobs. “CEOs are just as susceptible to the poaching and resignations occurring in the labor market as any other worker,” he says. F O R B E S M I D D L E E A S T.C O M
While CEO departures are on the rise, the compensation for the top brass bounced back significantly last year, according to research firm Equilar, suggesting that companies are attempting to keep their CEOs at the helm to navigate current uncertainties. In 2021, the median CEO compensation in the U.S. swelled to $20 million, a 30.8% increase from 2020, according to Equilar’s most recent annual study
Tim Cook became the second-highest paid CEO in the world in 2021.
of America’s 100 largest companies. In comparison, median CEO pay in 2020 slid by 1.6% to $15.5 million from $15.7 million in 2019. While 2020’s figure presented little change from the previous year, 2021’s $20 million median award to CEOs tells a different story. Equilar argues that several companies awarded the top job holders bonuses and stock awards to help steer organizations during turbulent times. In
2021, median cash bonuses among CEOs soared 46.4% to $4.2 million while stock awards increased by 22.7% to $10.5 million. Among last year’s top 10 highest-paid CEOs on Equilar’s ranking were tech leaders Patrick Gelsinger of Intel ($177.9 million), Tim Cook of Apple ($98.7 million), Hock Tan of Broadcom ($60.7 million) and Satya Nadella of Microsoft ($49.9 million). Gelsinger was the highestpaid CEO, despite having run Intel for only 11 months from his February appointment last year. Cook, who leapfrogged by 54 places to become the second-highest paid chief executive, and Nadella, who dropped to fourth place, saw their total 2021 pay package increase by 569% and 12% from the previous year, respectively. These findings illustrate just how much the pandemic has prompted companies to lure top-level talents with lucrative pays. In the process of doing so, however, the CEO-toworker pay gap widened even more in 2021, with CEOs making 254 times more than the average worker, according to Equilar. The Great Resignation has also upended years of efforts by employers to retain their best talent as they scramble to meet more pronounced worker demands that are beyond paychecks. According to Microsoft’s Work Trend Index 2022, employees are now looking for positive culture (46%), mental health/wellbeing benefits (42%), a sense of purpose/meaning (40%), and flexible working hours (38%) in a job, among other aspects. AUGUST 2022
BY CHERRY AISNE TRINIDAD , IMAGE BY EUGENE POWERS/ SHUTTERSTOCK.COM
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Burnout, inflation, and fears of recession are some factors reportedly leading to a higher rate of exits at the top level.
