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Who Makes It To The Top?

June 3, 2008

Those who make it to become CEO of major companies – and the duration of their tenure – have changed in recent years, according to several research studies. A report in The Economist highlights that former CFOs are now the most likely to rise to corporate leadership, replacing the traditional Marketing route.

Today, more than 20% of US chief executives have come from Finance, more than double the percentage of 10 years ago. The research also highlights that ‘lifers’ (those staying with one company) still occupy 26% of the top jobs in the US, compared with just 18% in Europe. And these lifers also get to the top faster – they took 22 years on average, compared with a 26 year average for those who changed companies.

The study shows interesting contrasts between the US and Europe – perhaps the reverse of some popular stereotypes. For example, European CEOs are slightly yuounger than their US counterparts (54 versus 56) as well as being more likely to have worked for more than one company (82% versus 74%). Their tenure is less secure – on average 7 years versus 9 years – and 18% were replaced last year (against 15% in the US).

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