The numbers coming out of the CEO market should unsettle every director. Russell Reynolds Associates’ Global CEO Turnover Index recorded 234 chief executive departures from listed companies in 2025, marking a second consecutive all-time record, up 16 percent year over year and more than 20 percent above the long-run average. Spencer Stuart counted 168 new CEOs named across the S&P 1500 alone, the most since 2010. And the churn has carried straight into 2026: Workday, PayPal, Target, Walmart and even Apple have announced or accelerated transitions, and Russell Reynolds’ Q1 2026 update shows boards paying an unprecedented premium for experience: 41 percent of incoming S&P 500 CEOs had already run a public company, the highest level in the index’s nine-year history and quadruple the share of just two years ago.
Read those data points together and a pattern emerges. Boards are moving faster on underperforming CEOs, which is healthy. But the surging preference for proven outside operators is a tell: Too many boards, forced into a transition, discover their internal pipeline cannot produce a ready successor, so they buy certainty on the open market. That is succession planning by checkbook, and it is an admission of governance failure. The danger is that this reactive approach is being tested just as the demands on CEOs are about to change more profoundly.
Succession is a board process, not an event
When I studied more than 150 U.S. and European board leaders to identify what separates high-performing boards from the rest, one cultural marker appeared again and again: The best boards conduct a genuinely rigorous annual CEO assessment and protect the integrity of the CEO succession plan with regular, full-board focus. On struggling boards, succession was an annual courtesy briefing. On high-performing boards, it was standing work, with CEO pipeline development elevated to a recurring full-board agenda item, the CEO’s annual review expanded to include 360-degree input, and executive sessions of real quality followed by direct, documented follow-up with the CEO.
The 2026 evidence reinforces the importance of that discipline. Russell Reynolds’ first-quarter data shows average outgoing CEO tenure jumping to 10 years, from under seven a year earlier. Tenure alone does not tell us whether a board has made the right call; it can reflect durable leadership or a reluctance to confront the need for change. A functioning assessment cadence gives directors the confidence to keep a strong CEO longer and the readiness to act quickly when the answer changes. Boards without that cadence get the opposite: surprise departures, scrambled searches and premium prices for external certainty.
The next turnover wave may be much larger
I believe the rate of CEO turnover over the next three to five years could dramatically exceed even today’s record levels. That is a forecast, not a conclusion the current turnover data can prove, but three forces are converging: 1) a significant cohort of CEOs has been in place for many years; 2) equity valuations at many public companies leave little room for missed expectations; and 3) artificial intelligence is beginning to move from an efficiency initiative to a challenge to the economics, competitive position and operating model of individual businesses.
The combination could shorten the window boards have to decide whether their incumbent CEO is the right leader for the company’s next chapter. A chief executive who excelled at optimizing the existing business may not be equally equipped to reinvent it. Even highly successful CEOs will face new questions about capital allocation, talent development, technology architecture, speed of execution and which parts of their company’s value proposition remain defensible. When market expectations are elevated, investors may have less patience for a leadership team that recognizes the disruption too late.
The implication is that boards must evaluate leadership against the business model the company will need tomorrow, not only on the results it delivered yesterday. CEO assessment, strategy development and succession planning can no longer run on separate tracks. Boards should be testing the incumbent’s ability to lead AI-enabled transformation while developing internal successors and potential external options who could lead a materially different enterprise. The boards that do this now will have choices. Those that wait for performance to deteriorate may find themselves competing for the same small pool of ready-made leaders.
The team behind the transition
Succession excellence is downstream of something more basic: whether the board operates as a high-performing team at all. High-performing teams are small groups with complementary skills, committed to a common purpose and set of performance goals for which they hold themselves mutually accountable. Directors who do real work together, whether in committees, on special initiatives or inside a CEO succession or strategy process, move most rapidly into that team mode. Succession work, done properly, is therefore doubly valuable: It produces the next CEO, and it forges the board.
The surveys suggest most boards have not made that leap. In the latest PwC and Conference Board C-Suite study, 93 percent of executives said at least one director on their board should be replaced, a record high, and nine out of 10 said the board’s own assessment process needs improvement, particularly in linking assessment results to succession planning and real composition change. A board that cannot manage its own succession honestly has little standing to manage the CEO’s.
A four-step reset
For boards ready to treat leadership continuity as a competitive weapon rather than a contingency plan, the path I have seen work follows four steps. First, reset the board’s performance expectations, including governance role, guiding principles and operating practices, composition, leadership and individual director contribution. Second, embed high-performing team attributes deliberately rather than hoping they emerge. Third, leverage an unsparing self-assessment to drive specific full-board and committee improvements, including developing new governance capabilities. Fourth, align the board’s work directly with the enterprise value creation plan. This means devoting the bulk of meeting time to specific value delivery priorities and making the CEO pipeline a permanent agenda fixture, not a single board conversation each year.
None of this happens without the board leader taking full personal ownership. In my experience, that is the single non-negotiable. Where the board chair or lead director owns the process, CEO succession becomes a central source of creating strategic advantage; where it is delegated to a committee calendar, it runs the risk of losing focus and becoming the crisis the 2026 headlines keep describing.
CEO transitions are the most consequential decisions a board makes, and the market is now grading that work in public through record turnover statistics, in the premium paid for outside experience and in activist campaigns that increasingly demand the CEO’s replacement outright. If the technology disruption ahead proves as consequential as it appears, today’s record departure rates may be only the beginning. The best boards will not wait for the next turnover statistic to assess whether their CEO, succession pipeline and strategy are ready for the next era. The rest may find that the market makes that judgment for them.
