Strategy&: Dutch Chief Executives safer in their seats

13 July 2015

The percentage of changing/departing CEO’s in public Dutch organisations has in the past year declined 12%, the lowest level since 2000. Within the surveyed companies, there continues to be a trend towards more planned succession (as opposed to forced departure) of top executives. Further, external CEOs need to depart more often than internal executives. In the past year, no women took over the position of a leaving CEO, research by Strategy& shows.

Since 2000, strategy consulting firm Strategy& (formally Booz & Company) studied CEO-transitions and succession at 2500 of the largest public companies worldwide. For the identification and classification of a CEO-transition at one of these businesses, digital media and documents from all over the world are used. In the same way, Strategy& produced a supplementary study of CEO-transitions* in the Netherlands by all 50 AEX- and midcap- businesses over the past 15 years. The sources consulted included announcements of retirements and the appointment of top executives.

Less transitions at the Dutch top
From the Strategy& research, entitled Chief Executive Study 2014’, it was apparent that the percentage of transitions at top business on the Dutch AEX and AMX was at 12% significantly down on 2013, when 18% of executives left. In 2012, as many as 26% of top executives made the move. The number of CEOs that left on the basis of a fusion or takeover stayed the same over past years at 2%.

Dutch Turnover Rate by Reason

The number of Dutch CEO transitions (12%) is still lower than those of CEOs on average in the rest of the world, of which 14.3% left their position. This means that the number of transition last year reached the lowest level since 2000**. Considered over the past 15 years, the average number of CEO transitions at the top of businesses in the Netherlands – which stands at 20% – is considerably higher than the average for the rest of the world, at 13%.

2014 CEO Turnover Rate by Region and Reason - 2014 Dutch Turnover Rate

More planned successions
The report also highlights that within public business boards worldwide considerably more attention is paid to planning succession of top executives. In 2014 the number of planned transition stood at 78%, while between 2000 and the end of 2002, 63% of every succession was planned. Between 2012 and 2014, the level of planned successions increased to 82%.

In the Netherlands, the percentage of planned transitions is lower. Between 2000 and 2002 there was on average in 42% of all transitions talk of a ‘planned’ transition, and between 2012 and 2014 this increased to 58% (50% in 2014). The percentage of CEOs in AEX and AMX that was forced out, because of disagreement with the board or disappointing performance, was considerably higher in the Netherlands compared to the rest of the world, at 33% and 13.2% respectively in 2014. Over the past 15 years, on average, 41 % of CEOs of the AEX and AMX were forced to leave the boardroom in the Netherlands, compared to only 25% worldwide.

Commenting on the figures, Coen de Vuijst, Partner at Strategy&, says: “The succession of CEOs in Dutch publically listed companies continues to occur with more fuss than in other countries. This shows that companies in the AEX and AMX could still better target planned successions.”

Dutch CEO Turnover Rate by Reason

External CEOs more often let go
The worldwide study discloses that in the past ten years, external CEOs were 44% more likely to leave, at 36%, compared to CEOs that were internally promoted, at 25%. In the Netherlands the percentage was what lower: in the past ten years, 25% more external CEOs were let go than internal chief executives.

Insider vs Outsider Forced Out CEOs

The percentage of these ‘outsider CEOs’ is higher in the Netherlands than in other countries. Since 2000, an average of 66% of incoming CEOs at Dutch publicly traded companies were insiders, compared to 77% in other countries. Last year, 60% of incoming CEOs in the Netherlands were internally promoted, compared to the 78% average worldwide.

Insider vs. Outsider Incoming CEOs

Less female CEOs
Finally the research discloses that fewer incoming Dutch CEOs are women, compared to the worldwide figures. Last year, 5.2% of new CEOs worldwide were female, while in the Netherlands in 2014 no incoming CEO was a woman. In the past 11 years, around 1.8% of new CEOs at AEX and AMX traded companies were women, compared to 2.8% worldwide.

Incoming Woman CEOs

* To get a clear picture, a distinction between the different reasons for the departure of CEOs needs to be made.

- Forced out: whereby the CEO is made to leave, mostly due to poor performance, or because of a disagreement with the supervisory board.
- Early departure because of fusion or takeover: whereby the CEO leaves after a business is taken over or fused with another business.
- Regular departure: whereby the CEO leaves as a consequence of regular planned succession, often because of retirement or health reason or sudden death.

** Only in 2007 a comparable percentage (12%) was visible.


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High employment drives deals to access fresh talent

09 April 2019

The UK continues to have a historically low unemployment rate, resulting in a tightening employment market and demand for recruitment services. The industry topped £12.3 billion last year, while valuations continued to rachet up. There were were 32 firm acquisitions in the recruitment services space last year, up significantly on the previous five-year average.

Labour markets globally are tightening, particularly in developed economies. At the same time, access to top talent is becoming increasingly difficult to source, as demand for that talent continues to rise. Higher demand has been one of the key drivers for acquisitions in the space. New analysis of the recruitment M&A market, from consultancy firm BDO, looks at current trends and future projections for activity in the segment.

The UK employment rate has grown considerably over the past decade, with the number of NEET decreasing, more women joining the workforce, and older people continuing to work, among other trends. Participation rates hit more than 75% in 2018, up from around 73% in 2014. The unemployment rate dropped to 4.1% last year, the lowest level in more than 40 years.

UK Recruitment Market


The recruitment industry has enjoyed strong growth over the same period, with revenues increasing from around £8 billion in 2014 to £12.3 billion last year. However, the growth rate for the industry is expected to stall for the coming years – the firm is projecting annual growth of 0.1% to 2024. The stall reflects deep seated uncertainties stemming from the future of the UK, from migration to internal employment in an increasingly uncertain future.

According to the firm’s analysis of market trends for UK listed FTSE recruitment companies, their performance over 2018 outperformed the wider FTSE market by a significant market during some months – the end-of-year uncertainty hit both recruitment and non-recruitment firms with relatively equal strength. The drop partly reflects market sentiment about the future of the UK.

FTSE Listed Recruitment Firms Average EV/EBITDA Multiple


The study also considered the multiples growth, average EV/EBITDA multiples, over the past year – which has shown considerable ups and downs. The yearly average multiple of 10.4x was above that of 2017’s 9.9x – although a 26% drop at the end of the year was significant. The drop was tied to the relative volatility in macroeconomic conditions affecting the globe, though another major contributing factor has been Brexit and political instability.

Global M&A

The global recruitment M&A market was particularly active in the UK, with 32 deals last year – a five-year high, and well above the 17 recorded for second-place US. Deal activity in the UK was focused on expertise and capacity in industrial and technical sectors, reflecting skills shortages in those segments. The US was largely focused on healthcare-related M&A, representing 25% of their market.

Overall, of the 92 deals in 2018 (a 21% drop on 2017) generalist firms were the most in demand, at 25% of the total, followed by education at 14% and engineering & construction at 13%. Software saw relatively low demand, at 2%.Investment into the UK by country

In terms of investments made into the UK, domestic investment continues to be the most dominant, accounting for 24 deals. Japan made three deals, although Brexit is seeing the country become increasingly nervous about investment. The US accounted for two deals. The longer-term trend shows that domestic investment is up on 2017, hitting the highest level in five years, while the US has reduced its M&A investment into the UK.

Commenting on the results, the firm noted, “The latest report shows the recruitment sector remains strong and continued to grow through 2018 despite facing many challenges. Notwithstanding the personalised nature of these services, the market continues to evolve, seeing traditional recruitment firms utilising available technology along with new entrants showcasing innovative platforms.”

Related: High UK employment masks troubled economy.