Boards Hire Retired CEOs as Succession Pipelines Dry Up
· news
Boards are Hiring Retired CEOs as Succession Pipelines Run Dry
Boards of major companies, including Verizon and Boeing, have begun to turn to retired CEOs in search of leadership talent. This trend raises questions about the effectiveness of CEO development programs and the willingness of boards to invest in homegrown executives.
Hiring experienced leaders can be seen as a practical solution, given their proven track records and ability to hit the ground running. However, this approach overlooks the underlying issue: a lack of robust leadership development within companies. According to Shawn Cole, president of Cowen Partners, boards are struggling to find real CEO contenders because internal talent is in short supply.
Data from Russell Reynolds Associates shows that 34% of CEOs appointed by S&P 500 companies in the first half of 2026 previously led a public company, up from 22% the previous year. This trend extends beyond CEOs; incoming executives are also being recruited from within their own companies. Apple’s John Ternus, for example, hired his trusted lieutenant Laura Legros out of retirement.
The reliance on retired CEOs can be seen as a form of deferring difficult decisions. While these individuals bring valuable experience to the table, they often lack the energy and innovative thinking required to drive meaningful change. Cracker Barrel’s decision to hire Dave Deno, a 69-year-old retired CEO, has raised concerns about his ability to attract younger clientele and introduce new ideas.
The consequences of this trend are far-reaching. When boards prioritize external hires over internal development programs, they send a signal that investing in their own talent is not a priority. This can lead to a culture of complacency, where companies settle for mediocrity rather than striving for excellence.
As CEOs stay in their jobs longer, opportunities for their successors to gain experience and develop leadership skills are limited. This depletes the internal bench and forces boards to seek out experienced executives from outside. Boards have a responsibility to demand more robust leadership development programs that foster homegrown talent.
By investing in their own people, companies can create a pipeline of future CEOs equipped to drive innovation and growth. The trend towards hiring retired CEOs may seem like an easy solution, but it is ultimately a short-term fix that ignores the underlying problem. Companies must recognize that the safe choice is not always the best one and prioritize internal development programs to create a more sustainable and innovative leadership culture.
Reader Views
- CSCorrespondent S. Tan · field correspondent
The irony of corporate boards scrambling for external talent while neglecting their own leadership pipelines is nothing short of astonishing. A closer examination reveals that this trend is often driven by expediency rather than a genuine search for fresh perspectives. By prioritizing experienced outsiders over internal development programs, companies risk stifling innovation and perpetuating the same old thinking that's left them searching for solutions in the first place. The long-term consequences will be telling: mediocrity becomes the new standard, and complacency reigns supreme.
- RJReporter J. Avery · staff reporter
This trend of hiring retired CEOs may be a Band-Aid solution for boards struggling with succession pipelines, but it's also a cop-out. By relying on seasoned executives from outside, companies are avoiding the hard work of developing homegrown talent and creating a culture of mediocrity within their own walls. The real question is: what happens when these older CEOs inevitably retire or step down? Will they leave behind a legacy of fresh ideas and revitalized leadership, or just a power vacuum waiting to be filled by another outsider?
- EKEditor K. Wells · editor
The reliance on retired CEOs is a band-aid solution that ignores the root cause of a talent drought: poor succession planning. By prioritizing external hires, boards are essentially admitting defeat in their internal development programs. But what's often overlooked is the potential for "retro-succession" – where boards hire familiar faces from within to fill gaps, rather than truly empowering younger leaders. This strategy risks stifling innovation and perpetuating the status quo, ultimately leading to stagnation, not progress.