While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted up
On approaching his 60th birthday this year, long-serving Tullow Oil boss Aidan Heavey told staff he felt “like two 30-year-olds”. A handful of recent shock departures by 50-something chief executives at European blue chip companies – none of them under any obvious pressure to quit – suggest some of his peers either lack that vigour, or want to channel it elsewhere.
Peter Voser is giving up one of the world’s most challenging chief executive roles at Royal Dutch Shell next year, before his 55th birthday, in pursuit of a “lifestyle change”. Swiss engineering group ABB’s 55-year-old boss Joe Hogan is also going, for “private reasons”. Pierre-Olivier Beckers, 53, is walking out on Belgian retailer Delhaize, and Paul Walsh, 57, is waving goodbye to drinks multinational Diageo. All four are about average European CEO age.
While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted up in recent years, and not just because of the tough economic times.
“The reality is it’s gruelling. It’s really tough, and there comes a point where you don’t want to do it any more,” said Ian Butcher, who headhunts board-level and senior executives for MWM Consulting.
“The quarterly reporting, the governance, the regulatory aspects, it just becomes very wearing – the level of scrutiny, the pace at which things are moving, the short-term nature of how people look at any given situation. Even over the past five years these things have made CEO a tougher position to hold, and the travel that people have to undertake in these jobs – it’s just something they run out of steam on.”
Some recent early retirees, while still well short of traditional retirement age, also got to the top spot early. “They’re still in their early fifties, with energy and a desire to do something, but they want to do something different, something quite significantly different sometimes,” says Butcher.
Voser fits that bill. He has no plans to collect well-paid chairmanships and non-executive directorships, as many ex-CEOs have done in the past.
Former Tesco chief Sir Terry Leahy has also resisted that gravy train since he left two years ago.
As for the early starters, executive search industry professionals point at people like Andrew Witty, the CEO of GlaxoSmithKline, who took on the job aged 44 in 2008 and would have to stay in harness for another decade to reach 60 in the role.
Blue-chip bosses as young as Witty are still rare, but over a quarter of Europe’s current crop have less than two years in the job, and more than half have less than four, according to data from executive search specialists BoardEx.
The BoardEx data, collected for Reuters from 238 companies in the main stock indexes of Germany, Britain, France, Spain, Italy, Belgium, the Netherlands and Denmark, puts the median CEO age at 55. The longest serving of them is Martin Gilbert of the British fund Aberdeen Asset Management. Though younger, at 57, Gilbert pips the 28.3-year tenure of Tullow’s double 30-year-old Heavey, with 29.8 years at the helm.
There are 17 top European CEOs who have been in the job for less than six months, and the youngest of the 225 in the group for whom ages were available is Vitaly Nesis, 37, who runs Polymetal International, the London-listed Russian precious metals miner.
While the recent spate of quitters are looking for something else to do, there are still some who appear to want nothing but to stay.
In the BoardEx group there are four over 70, and the oldest by eight years is Albert Frère, CEO of Group Bruxelles Lambert. Perhaps some linger on for fear that the pension pot is still a little light. Frere will have put such qualms behind him long ago. At 87, he is Belgium’s richest man.