Retail CEO turnover surged in nightmare year 2019 says headhunter Korn Ferry
Last year’s extremely tough trading conditions saw 55 retail chiefs head for the door, with fashion and luxury experiencing more CEO changes than any other category.
According to a report from Korn Ferry, the global organisational consulting firm, CEO changes in the retail industry surged by 25% in 2019, as companies’ response to the challenges was to seek out new leadership styles. This is the highest churn since 2012, when 56 retail chiefs were ousted and replaced.
The increase in turnover occurred in one of the most difficult years for the retail sector in over a decade. Wavering consumer confidence, coupled with Brexit uncertainty, a general election and rising business rates costs, combined to create an ‘annus horribilis’ for the sector.
The research reveals retailers not only opted for fresh talent, but also favoured some functional backgrounds over others. In fact, companies named fewer CEOs with commercial/sales or buying and merchandising backgrounds than in 2018. Instead, the number of retail CEOs with financial experience rose from 15% to 21%, as retailers shifted their focus towards strong financial management, debt restructuring and management of investor relations.
As one of the sectors worst hit by the retail crisis, fashion and luxury experienced the biggest CEO turnover. This was a result of several fashion chains falling into administration, including Debenhams, Karen Millen, Jack Wills, LK Bennett and Bonmarché.
Korn Ferry's Sarah Lim said: “The past year saw a perfect storm of challenges for retail, resulting in profit warnings, a further spate of company voluntary arrangements and a number of high-profile high street names going into administration.
“As we head into a new decade, one thing is for sure, retail will change unrecognisably over the next 10 years -- those who lead our industry will need to do so too.”
According to the report, just 23% of retail bosses appointed last year are women. Card Factory’s Karen Hubbard remains the only female CEO at the helm of a large listed retailer.
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