As we look across the landscape of corporate leadership today, a startling trend emerges: a record number of CEOs are quitting or stepping down. In fact, more than 1,400 chief executives left within a six month period last year alone, marking a nearly 50% increase from the same period the year before.
This phenomenon, part of what some are calling the “Great Resignation for executives”, signifies a critical moment for Human Resources within these organizations.
The Stress Behind the Exodus
The surge in CEO departures can be largely attributed to the unprecedented levels of stress experienced during the pandemic. This changed the face of leadership, as the role of CEO evolved from ensuring profits and appeasing shareholders and investors to managing the well-being of their teams as a whole. Now, leaders are expected to continue to steer the ship toward financial success, while keeping employees satisfied and engaged, remaining empathetic and open, and being consistently ahead of the game in technology.
The result? Intense pressure that has left many executives feeling burnt out and ready to step down.
Why HR Plays a Critical Role
Human Resources departments stand at the forefront of this transitional period, tasked with both managing the fallout from these high-profile departures and ensuring the stability and continuity of the organization.
Succession Planning: HR must work closely with boards to identify potential successors and ensure a seamless transition. This involves understanding specific leadership needs of the organization and matching them with the right internal or external candidates.
Leadership Development: Developing potential future leaders from within the organization is another key area where HR can add value. HR should be identifying and nurturing potential talent, while simultaneously providing them with the necessary skills and experiences to take on larger roles.
Culture Fit and Continuity: HR plays a vital role in maintaining organizational culture during a change in leadership. This includes educating new leaders about the core values and norms of the company and ensuring they are a good cultural fit.
Beyond handling transitions, HR must address the underlying issues that contribute to CEO burnout and departure. Such a plan should include:
Enhancing Employee Support: Increasing support for executives through coaching, mental health resources, and stress management programs can help alleviate some of the pressures that contribute to burnout.
Revising Work Models: In light of the pandemic, reevaluating work models to ensure they are sustainable and conducive to long-term executive health and well-being is crucial.
Strengthening Engagement and Retention Strategies: For the broader workforce, HR should continue to focus on strategies to engage and retain top talent, ensuring the organization remains resilient and adaptable in times of change.
The record number of CEO departures presents a unique challenge and opportunity for HR. CHROs can play a truly pivotal role in guiding organizations through these transitions. Ultimately, HR’s effectiveness during this time will not only impact the success of the CEO transition, but also the overall health of the organization.
In times of transition, having a robust HR strategy is more important than ever. If your organization is navigating a leadership transition, or if you're looking to bolster your HR capabilities to better support such changes, consider reaching out to our fractional HR team. Our experts are equipped to provide tailored HR solutions that ensure seamless transitions and maintain organizational integrity.