CHICAGO - So much for sticking around for the bonus.
At a time when companies are straining to fill all kinds of posts, a surprising number of them faced the new problem this summer of having to fill their very top jobs. The latest vacancies, which ran across a wide spectrum of companies, came as Bank of Hawaii's Lawrence M. Johnson, Ameritrade Holding Corp.'s Thomas Lewis, and Finova Group's Sam Eichenfield relinquished their posts. Several other chief executives resigned from smaller community banks and financial firms.
Given the seasonal factors in play - the dog days favor vacations over job searches - perhaps it only seemed at times that the number of departures had swelled to extraordinary levels.
But it was no illusion.
Indeed, it's been a hectic year all around executive suites, one that has also claimed the jobs of such notables as John S. Reed, Edward E. Crutchfield Jr., and, most recently, Verne G. Istock and Philip G. Heasley. The turnover appears to have reached a climax in recent months, culminating in what turned out to be a record level of departures in August.
By the count of Challenger Gray & Christmas, a Chicago outplacement firm that tracks staffing trends, chief executives from 15 financial companies called it quits just last month. Across all industries, the total of 118 CEOs who left their jobs for one reason or another established a record for any month. Since August last year, 919 CEOs have become ex-CEOs.
Demands by shareholders and board members for immediate performance, in favor of meeting long-term growth objectives, are putting CEOs under more scrutiny. Mr. Johnson said he was resigning because he had failed to create the shareholder value he had promised. Mr. Eichenfield's departure came as Finova's stock was plummeting. Mr. Lewis left for "personal reasons."
"Wall Street's patience has gotten shorter, along with the board's patience," said Lee Pomeroy, president of the New York placement firm Executive References LLC. When financial companies have gone through tough quarters and their stock punished, boards "have increasingly decided to act rather than wait for more punishment," he said.
To be sure, this year has had a wave of high-profile departures, in and just below the CEO ranks.
Last week Mr. Heasley said he was quitting as president of U.S. Bancorp because he wanted to pursue opportunities to run a company elsewhere. In April Mr. Reed retired as chairman and co-CEO of Citigroup. In March Mr. Crutchfield relinquished the CEO title at First Union Corp., citing health reasons.
The August head count was 55% higher than the number of departures in July. Challenger Gray made the point that August is typically a quiet month, with executives running off to the beach, golf course, or mountain range and putting off important career matters until after Labor Day.
And the toll even topped January, when 95 top executives quit. January is usually the biggest month for good-byes as executives look to start the new year fresh, Challenger Gray says.
According to the study, the financial services industry was second last month in the number of departures behind only the dot-com world, in which 21 CEOs quit.
The study said that among the CEOs who quit during the month, 35% resigned, 19% retired, and 16% offered no reason.
"These CEOs really are under the microscope today," John A. Challenger, head of the firm, said in an interview Thursday. "Few of them can withstand more than a few bad quarters of not meeting earnings expectations."
Much of the pressure comes from the avalanche of information available to investors about companies, in publications or on the Internet, Mr. Pomeroy said. "Their decisions are constantly being second-guessed. It's an environment where the CEO is really walking a fine line."
Lately that has been true among financial companies. With interest rates hampering revenue growth, CEOs of banking companies are finding it harder to have long tenures. The departing executives highlighted in the Challenger study stayed an average of 5.9 years.
"It's very difficult to put in programs that will transform the company in the long run," Mr. Challenger said. "Investors want overnight change. They want to see the earnings turn around sooner than later. That is the environment today."