Summary
- 2024 CEO turnover hit a record—202 exits (+9%)—undermining strategy and investor confidence.
- Boards are underprepared: only 34% prioritize succession for 2025; 30% lack a successor (10% unsure), hindered by crises, competing pressures, interim stopgaps (71%), weak assessment (40%), and founder dynamics.
- Berkshire and Apple show early, aligned planning and rigorous assessment enable smooth, culture-preserving transitions.
In a surprising twist within the modern business landscape, CEO turnover has reached a record high. CEO exits in 2024 saw a 9% increase from the previous year, with 202 top leaders calling it quits.
The departure of a CEO affects a company’s strategic vision, its direction, and its reputation among shareholders.
Still, while boards know that everything rises and falls on leadership, few are allocating a sufficient amount of time and thought to lining up the next CEO in the event of an unexpected departure.
Recent surveys show that just 34% of boards have indicated that CEO and C-suite succession is a top priority in 2025. The topic ranks third on the list of things directors plan to talk about at the next board meeting, and even lower on the list of what they believe needs their focus in the year ahead.
If you’re wondering how those discussions are shaping up, the data seems equally bleak. According to the National Association of Corporate Directors (NACD), 30% of directors say that their board doesn’t have a successor identified.
Another 10% are unsure whether they have reached a consensus or not. Three-quarters of boards are regularly discussing succession planning, but questions remain as to whether those discussions produce meaningful outcomes.
Here’s why, looking at:
- What’s Stopping Companies From Effective Succession Planning?
- Learning From Real-World Succession Planning Success Stories
- Early Planning Is Key for a Succession Plan That Works
What’s Stopping Companies From Effective Succession Planning?
It may well be that directors know deep down how crucial succession planning is, but find it challenging to execute successfully. The following are just some of the obstacles that may be standing in the way.
Crises
In 2019, 69% of corporate leaders reported that they had experienced a crisis in the last year, and 38% reported experiencing more than one.
Directors who are always putting out fires are prioritizing short-term survival over long-term strategy. Additionally, corporate priorities and direction can shift drastically during and after a crisis situation. This makes it especially difficult to nail down which competencies and skills a future CEO would need to successfully move the company forward.
Distractions
Today’s directors have a lot of challenges that are vying for their attention. Many have to worry about activist investors attempting to make their presence felt by forcing the replacement of board members who don’t suit their interests.
There’s also noise from the general public urging action on social issues like DEI and ESG. Directors may be overwhelmed by conflicting stakeholder demands and just don’t feel they have the time or space for proper succession planning.
Reactionary Thinking
Some directors simply have a “cross that bridge when we get to it” mentality about the entire concept of succession planning.
NACD data indicates that 71% of boards have identified an interim CEO in case of a sudden departure or other emergency.
Although succession planning requires long-term strategic thinking, these boards are:
- Employing a short-term stopgap measure
- Waiting for something unfortunate to happen before they truly plan for the company’s future.
Ineffective Assessment
According to the NACD survey, 40% of directors cite candidate assessment as a challenge to effective succession planning.
Perhaps these directors haven’t taken the time to identify the traits and competencies they need in the next CEO. Or they may not be confident that their assessment model is sufficient to determine whether a candidate is truly ready for the job. Either way, many boards lack the tools needed to identify and cultivate a potential successor.
Entrepreneurial Ties
Founder CEOs are often visionaries with deep emotional ties to the business, which means they and their boards face particular challenges when it comes to succession planning.
Typically, a founder CEO possesses a unique set of skills that have allowed them to bring an idea to life and scale it significantly. The board may find it near impossible to find someone who can match the founder and have the passion and drive needed to take the company to the next level.
Learning From Real-World Succession Planning Success Stories
Just 44% of directors feel that their board’s current CEO succession plan will result in an effective candidate taking the role. Though many companies are struggling with succession planning, not all businesses are faltering in this area. Here are a few that are doing it right.
Berkshire-Hathaway: A Beacon of Strategic Thinking
In May 2025, 94-year-old Warren Buffett announced his plans to step down as CEO of Berkshire-Hathaway at the end of the year.
However, the board didn’t have to panic about replacing him; in 2021, Buffett publicly stated his intention to hand over the reins of the company to Greg Abel, the company’s vice-chairman of noninsurance operations.
This type of forward thinking has given the Berkshire-Hathaway board clarity on:
- How the company will move forward with a new leader
- What the transition will entail
- How it will communicate with confidence as things shift.
Without a solid plan in place, one of the world’s foremost institutions would have been scrambling for answers, putting its legacy, investors, and the business itself in jeopardy.
How Legacy Lives on at Apple Inc.
Apple faced a similar transition when co-founder and CEO Steve Jobs announced his retirement in 2011 amid serious health issues. He and Tim Cook, Apple’s current CEO and former COO, had already been working side by side for over a decade when Jobs recommended him for the role.
Apple’s board was even able to validate Cook’s skills during his stint as interim CEO during Jobs’ 2009 medical leave.
In addition to his succession plan, Jobs established Apple University, an internal training program that aims to pass down the company’s core values and principles. In this way, Jobs worked to build a qualified succession pipeline to ensure his company — and its unique approach to innovation — lives on.
Early Planning Is Key for a Succession Plan That Works
As your board considers creating a CEO succession plan, it’s important to start early and talk often.
All directors should be on the same page when it comes to the plan’s primary strategy.
With a bit of forward thinking and an effective system for assessment, the board can nurture a candidate who will continue to lead the company to success, even in the midst of change and uncertainty.
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