CEOs had a rough year in 2005. Compared with 2004, more died, got fired, resigned, or left their jobs for health reasons, according to consulting firm Challenger Gray. In fact, executive turnover has increased dramatically in the last five years, partly because boards are no longer patient when CEOs misbehave.
"Boards are just much more demanding than they've ever been," says Dr. Leslie Gaines-Ross, an executive at public relations firm Burson Marsteller, and an expert on CEO reputations. "Basically there's less time to get the job done."
Others point to that perennial punching bag, Sarbanes Oxley. Richard Jacovitz, senior vice president at Liberum Research, says the stress and requirements of Sarbox may have induced some executives to retire.
It's sad for CEOs, of course, when they get canned after a year on the job. But it can also hurt the company as a whole. Neither investors nor employees like the uncertainty engendered by a revolving door at the top. And then there are those costly severance packages.
Just how bad is CEO turnover? More than 1,300 top dogs left their jobs last year, compared with 749 in 2002, according to Challenger Gray, which tracks turnover at nonprofits and private firms as well as public companies. Communications firm Burson Marsteller, which follows only the Fortune 1000, found that 129 top chief executives left their posts in 2005, compared with only 57 five years ago. And the trend has continued in the first months of 2006.
The worst sector to be a CEO: biotech, followed by banking and manufacturing, according to Liberum Research. Those three industries saw the highest levels of executive churn last year. Since biotech is a relatively young industry, it may be going through growing pains. But some companies are hurting more than others: Neopharm, a cancer drug firm, has had four CEOs in the last two years.
Underperformance, not ethics, usually gets a CEO fired, according to consulting firm Booz Allen. This year's prime example: Hewlett Packard ousted Carly Fiorina because the company's merger with Compaq didn't deliver the desired results.
But it's more fun when sex and scandal are involved. Robert A. McCormick, former CEO of Savvis, resigned after American Express sued his company over an unpaid $241,000 bill at a topless club.
Harry Stonecipher, the former CEO of Boeing, was abruptly dismissed in March for having an affair with a female executive. Philip Purcell, former CEO of Morgan Stanley, stepped down after a long battle with the board and former executives.
Of course, many CEOs don't go down in flames. Donald Trump stepped down as CEO of Trump Entertainment Resorts after it emerged from bankruptcy, because he was too busy with his hit television show, The Apprentice.
Lee Raymond, CEO of Exxon retired to great acclaim after 42 years with his oil firm.
For less-lucky executives, who find themselves facing hostile boards, Forbes.com offers the following tips for maintaining steady employment.
Slideshow: Worst-Performing Bosses
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