Matteo Tonello, Head of Data Benchmarking and Analytics at The Conference Board, Inc., contributed to a recent report examining forced CEO departures in the Russell 3000 and S&P 500 indices. This comprehensive analysis, developed in partnership with ESGAUGE, Russell Reynolds Associates, and Rutgers Law School’s Center for Corporate Law and Governance, with authors Ariane Marchis-Mouren and Keil Lapore, sheds light on the frequency, causes, and sector-specific patterns of board-initiated leadership changes. The report scrutinizes data from 2024 through August 2026, offering valuable insights for boards and executives navigating the complexities of CEO succession.
Understanding Forced CEO Departures
The Conference Board/ESGAUGE defines a "forced" CEO departure as one where company disclosures or credible external evidence indicate that the board, activist investors, an investigation, performance concerns, misconduct, or strategic disagreements materially influenced the CEO’s exit. This classification relies on primary sources such as Form 8-K filings and official company statements. Even when a departure is publicly framed as voluntary, such as a resignation or transition, the report’s methodology includes reviewing external reporting to discern underlying board influence. Crucially, a voluntary characterization or the CEO’s eligibility for severance does not automatically preclude a departure from being classified as forced. The report acknowledges that some board-influenced exits may be privately managed and publicly presented as retirements or voluntary departures, meaning the reported figures represent a conservative estimate of publicly identifiable forced successions.
The report further categorizes the principal reasons behind these forced departures. These include underperformance, activist investor pressure, misconduct, board disagreement, strategic reset or restructuring, transaction-related changes, and termination without cause, among others. Underperformance, a frequent driver, is primarily assessed by considering whether the CEO departed before age 64 and if the company’s industry-adjusted total shareholder return ranked in the bottom quartile, with revenue, stock price, and market capitalization serving as additional contextual factors. When multiple factors contribute, the classification reflects the primary reason supported by available evidence.
Trends in CEO Succession
The analysis reveals that forced CEO departures are a natural, recurring aspect of leadership succession, not confined to a specific company type or sector. In the Russell 3000 index, forced departures saw an increase from 49 in 2024 to 55 in 2025. The proportion of succession cases categorized as forced remained relatively stable at 14.7% in 2024 and 14.8% in 2025, indicating that approximately one in seven CEO transitions were board-initiated in both years.
For the S&P 500, which comprises larger, more established companies, forced departures rose from seven in 2024 to ten in 2025. The overall rate increased from 14.3% to 15.2% of all succession cases. While the absolute increase is higher in the S&P 500, the percentage increase is comparable to the Russell 3000, suggesting that forced succession is a consistent feature across different company sizes.
However, the trend shifted in 2026. Through August of that year, the Russell 3000 recorded 20 forced departures, accounting for 9.9% of succession cases. Similarly, the S&P 500 saw only two forced departures, representing 6.3% of its succession cases. While the share of forced departures has decreased in both indices for 2026, the report emphasizes the enduring governance takeaway: boards must remain prepared for CEO transitions that may not align with their long-term succession timelines. This underscores the necessity of a standing contingency plan alongside a long-term succession strategy. Boards need to identify individuals capable of providing immediate continuity, assess the readiness of internal candidates, and determine when an external search is imperative to avoid time-sensitive decisions under pressure.
Sectoral and Size-Based Patterns
The report further dissects forced departures by business sector and company size. Across the 2024-August 2026 period, the consumer discretionary, health care, and information technology sectors collectively accounted for 59% of all forced departures. Consumer discretionary experienced the highest rates, with 11 departures in 2024 and 16 in 2025. Conversely, information technology saw a sharp decline in forced departures, falling from 11 in 2024 to just three in 2025. As of August 2026, the health care sector stood out, recording seven forced departures, representing 20% of its succession cases and a significant 35% of all Russell 3000 forced departures year-to-date. This fluctuating sector pattern suggests that no single industry is consistently more prone to forced CEO turnover.
Analysis by company revenue also revealed a lack of a singular profile for heightened succession risk. Forced departures occurred across the revenue spectrum in both 2024 and 2025. Companies with revenues between $1 billion and $4.9 billion reported the highest number of departures in both years. However, elevated rates were also observed among smaller and larger companies. In 2025, companies with less than $100 million in revenue had a 22% forced-departure rate, while the $1 billion-$4.9 billion and $10 billion-$24.9 billion groups each registered 19%. Even companies with revenues exceeding $50 billion experienced an 18% rate. This distribution indicates that leadership pressure is not concentrated at any specific market segment.
Over the entire analyzed period, the $1 billion-$4.9 billion revenue group accounted for 42 of the 110 departures classified by revenue, or 38%. This concentration is attributed more to the sheer volume of companies and succession events in this category rather than suggesting uniquely elevated risk for mid-sized firms.
The findings across sectors and company sizes reinforce a key message: boards should focus less on identifying a specific corporate profile that predicts turnover and more on the underlying conditions that necessitate leadership change. These include persistent underperformance, strategic misalignment, and increased investor scrutiny. The critical question for boards is whether weak results stem from uncontrollable external factors or from fundamental shortcomings in strategy, execution, or the CEO’s ability to adapt to the evolving environment.
Drivers of Forced Departures
Underperformance emerged as the leading reason for forced CEO departures, with its prominence increasing in 2025. It accounted for 31% of cases in 2024 and rose to 44% in 2025, remaining the largest category through August 2026. This persistent trend highlights that concerns regarding execution and results are a continuous factor in board-initiated leadership changes.
Furthermore, underperformance, activist investor pressure, and termination without cause collectively represented 70% of all forced departures during the analyzed period. In 2025 alone, these three categories comprised 78% of such cases. The report emphasizes that these categories are assigned based on the principal reason identified in source records. "Termination without cause" is used only when explicitly disclosed and no more specific cause, such as underperformance or activist pressure, is identified. This overall pattern points primarily to performance concerns, investor pressure, and board-driven decisions, rather than solely misconduct or isolated incidents.
Board Strategies for CEO Transitions
The recurrence of forced CEO departures underscores the need for proactive board strategies. Boards are advised to establish a robust performance review framework that extends beyond short-term financial metrics. This framework should encompass strategic milestones, competitive positioning, organizational capabilities, and the CEO’s effectiveness in navigating challenges and setbacks. Defining in advance the conditions that would trigger increased support, strategy reassessment, or active succession planning is crucial for distinguishing temporary underperformance from fundamental leadership issues.
Maintaining an "accelerated succession plan" is another key recommendation. This plan should go beyond preparing for an orderly retirement to encompass scenarios requiring immediate or board-initiated transitions. It involves identifying individuals for interim leadership, assessing internal candidates for permanent roles, developing compensation strategies to retain key executives, and determining the timeline for external searches. Annual market scans for external talent can help benchmark internal candidates, identify potential successors, and expedite the selection process when needed. The plan should also outline interim authority, retention packages, severance provisions, and communication strategies for employees and investors, thereby giving the board greater control over the transition process.
Finally, the report stresses the importance of proactive shareholder engagement. The significant role of activist pressure, particularly in the S&P 500, highlights the need to address investor concerns before they escalate into public challenges. When performance is under scrutiny, boards and management must clearly articulate the distinction between external headwinds and company-specific execution issues, outline response strategies, and gauge shareholder sentiment. Direct board engagement with investors, where appropriate, can help identify legitimate concerns early and address them through the company’s governance process, thereby mitigating the risk of a reactive response to external pressure.
Looking Ahead
Forced CEO departures are an ongoing reality in the corporate landscape. However, the data suggests that the primary drivers are company-specific, revolving around performance, strategic execution, and investor sentiment, rather than the size or sector of the company. Boards that establish clear performance expectations, conduct candid leadership assessments, and maintain a credible, accelerated succession plan are better positioned to manage leadership changes deliberately and effectively.
This report, produced by The Conference Board in partnership with ESGAUGE, Russell Reynolds Associates, and Rutgers Law School’s Center for Corporate Law and Governance, provides essential data and analysis for navigating these critical leadership transitions.
