- After 23 years in the position
- Praise for McVey
- Chris Concannon taking over
- McVey will remain as Executive Chairman at MarketAxess
- McVey said 99 words
(exechange) — New York, January 9, 2023 — Rick McVey, chief executive of MarketAxess, leaves his position. As announced by MarketAxess Holdings Inc. in a news release and in a regulatory filing published on Monday, January 9, 2023, Richard M. (Rick) McVey leaves his post as chief executive officer at the operator of a trading platform for fixed-income securities, after 23 years in the role, effective April 3, 2023.
It is the end of an era.
The average tenure of CEOs who announced their departure over the past 12 months was 8.3 years. Around 7% of CEOs left their posts after more than 20 years. This is according to data collected by CEO-exit research firm exechange.
exechange tracks CEO departures at the 3,000 largest publicly traded companies in the U.S., examines the reasons CEOs leave and determines the Push‑out Score™, a measure of pressure on departing chief executives on a scale of 0 to 10.
Rick McVey’s duties as CEO will be taken over by Christopher R. (Chris) Concannon, currently President and Chief Operating Officer at MarketAxess Holdings Inc.
“We head into an era of increasingly automated, data-driven trading”
MarketAxess did not give an explicit reason for Rick McVey’s departure from the CEO post. Stephen P. Casper, Lead Independent Director of the MarketAxess Board, said: “As we head into an era of increasingly automated, data-driven trading, we are fortunate to have in Chris a proven leader deeply experienced in electronic markets.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (26.6% of cases), implementation of a planned succession (16.4%) and the statement that the time was right for a change (8.4%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (6.3% of cases), personal reasons (3%) and conduct issues (2.4%). Rather rarely stated reasons are health problems (2.1% of cases), career change (2.1%), the desire for more time with family (0.9%), death (0.9%) and disagreement (0.6%). Sometimes, more than one reason was given. In 30.4% of cases, no reason was given.
McVey will remain as Executive Chairman at MarketAxess
MarketAxess stated: “[E]ffective April 3, 2023, Richard M. McVey, currently Chairman and Chief Executive Officer, will become Executive Chairman. ”
“Transition”
MarketAxess said: “Mr. McVey, Chairman of the Board and Chief Executive Officer of the Company will transition to the role of Executive Chairman of the Board, while Mr. Concannon, the Company’s current President and Chief Operating Officer, will be promoted to Chief Executive Officer of the Company, effective as of April 3, 2023.”
Share price decline since January 2021
The announcement follows a decline in MarketAxess Holdings Inc.’s share price of 44% since January 2021.
In the position of CEO since 2000
Rick McVey became CEO of the Company in 2000.
Richard M. McVey has been the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors since the Company’s inception.
As an employee of J.P. Morgan & Co., one of the Company’s founding broker-dealers, McVey was instrumental in the founding of MarketAxess in April 2000.
Prior to founding MarketAxess, McVey was Managing Director and Head of North America Fixed-Income Sales at J.P. Morgan, where he managed the institutional distribution of fixed-income securities to investors.
McVey led MarketAxess through the Company’s IPO in 2004, and since that time, MarketAxess has been one of the fastest growing financial technology companies in the U.S. public markets, with industry leading total stockholder returns.
McVey was named the Ernst & Young National Entrepreneur of the Year for financial services in 2012, and he has been named to the Institutional Investor Tech 40 list 15 times.
McVey was a member of the SEC Fixed Income Market Structure Advisory Committee, for which he chaired the Technology and Electronic Trading Sub-Committee from November 2017 to March 2021.
McVey serves on the Board of Trustees of Colby College.
He previously served on the Board of Directors of Miami (Ohio) University Foundation and Blue Mountain Credit Alternatives L.P., an asset management fund focused on the credit markets and equity derivatives markets.
McVey received a B.A. in finance from Miami (Ohio) University and an M.B.A. from Indiana University.
99 words by Rick McVey
In the news release announcing his departure as CEO of MarketAxess Holdings Inc., Rick McVey received praise.
In the announcement of the leadership change, Rick McVey said 99 words.
“Our growth potential has never been more promising”
Rick McVey stated: “In his current role, Chris has provided essential leadership as we successfully introduced a range of new trading protocols, expanded automated trading and execution, deepened our capabilities in data analytics and successfully integrated a number of strategic acquisitions. He will become CEO at a time when our growth potential has never been more promising, and our leadership team is deeper than ever. I am looking forward to my transition to Executive Chairman where my focus will be on supporting Chris in his new role, further developing corporate strategy, and working closely with key clients and our Board of Directors.”
Over the past 12 months, 27% of all outgoing CEOs remained silent in the departure announcement, according to data compiled by exechange. Departing CEOs who did make a statement said an average of 109 words. The longest statement was 382 words. The shortest statement was 23 words. Leadership transitions in which departing CEOs provide conspicuously short, excessively long or no explanations for their move are statistically associated with elevated pressure and show an increased incidence of Push-out Scores above the critical threshold of 5.
33% of CEOs are forced out or fired
When CEO departures are announced, exechange determines the Push-out Score on a scale of 0 to 10 to assess how likely it is that the chief executive was pushed out or felt pressure to leave the position, with 0 being most likely a voluntary move and 10 being most likely a forced exit. Anything over a 5 indicates that there are valid reasons to believe an executive may have been pushed out.
Of the 335 CEO departures in the Russell 3000 Index evaluated over the past 12 months (January 9, 2022, to January 8, 2023), the average Push-out Score was 5.7, according to exechange data. References to conduct issues, disagreements and irregularities lead to the highest Push-out Scores. When performance issues, time with family or other opportunities were cited as departure reasons, the average Push-out Scores were also significantly elevated.
Around 33% of the CEO departure events from the past 12 months received Push-out Scores of 8 or higher.
In other words, in the past 12 months, three in 10 departing CEOs were forced out or fired.
Pressure in the financials sector substantially below the critical threshold
Some industries are under generally higher pressure than others, and CEOs are feeling the strain. In the past 12 months, the communication, consumer staples and health care sectors showed the highest average Push-out Scores. By contrast, pressure on CEOs was lowest in the real estate, utilities and financials sectors, as measured by average Push-out Scores.
In the financials sector, which includes MarketAxess Holdings Inc., the average Push-out Score over the past 12 months was 4.3, which is substantially below the critical threshold of 5.
Nevertheless, even in this sector, some CEOs were compelled to leave their posts under what appeared to be severe stress. In the financials sector, 11 exiting CEOs received Push-out Scores of 8 or higher over the past 12 months, indicating that they were most likely forced out or faced strong pressure to step down.
Push-out Score for Rick McVey’s move determined
The Push-out Score regarding Rick McVey’s move is explained point by point in the exechange report.
exechange reached out to MarketAxess and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 3.2023 ($).