- After about half a year in the position
- Praise and thanks for McMahon
- Elimination of Dual Chief Executive Officer role
- Nick Khan becomes sole Chief Executive Officer
- McMahon kept it short and said 47 words
(exechange) — Stamford, Connecticut, January 11, 2023 — Stephanie McMahon, co-chief executive of WWE, leaves her position. As announced by World Wrestling Entertainment Inc. in a news release published on Tuesday, January 10, 2023, and in a regulatory filing published on Wednesday, January 11, 2023, Stephanie McMahon leaves her post as co-chief executive officer at the company that produces professional wrestling shows, after about half a year in the role, effective immediately.
The average tenure of CEOs who announced their departure over the past 12 months was 8.3 years. Around 5% of CEOs left their posts within their first year. 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.
WWE eliminates the dual Chief Executive Officer role. Nick Khan will be sole Chief Executive Officer.
WWE also announced that its Board of Directors unanimously elected Vince McMahon Executive Chairman of the Board.
Stephanie McMahon is the daughter of Vince McMahon.
“Review our strategic alternatives”
WWE did not give an explicit reason for Stephanie McMahon’s departure from the co-CEO post. Vince McMahon stated: “Together, we look forward to working with the Board at this critical moment in time to review our strategic alternatives and maximize value for all WWE shareholders.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (26.8% of cases), implementation of a planned succession (16.2%) and the statement that the time was right for a change (8.3%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (6.2% of cases), personal reasons (2.9%) 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 30.7% of cases, no reason was given.
Precise information regarding Stephanie McMahon’s future plans was not immediately available.
“Resigned”
WWE said: “Stephanie McMahon has resigned from her roles as Chairwoman and Co-CEO.”
WWE further said: “On January 10, 2023, Ms. McMahon informed the Company that she has resigned from her role as Co-CEO and as a member of the Board. As a result of Ms. McMahon’s resignation, Nick Khan assumed the role of sole Chief Executive Officer of the Company. Mr. Khan also remains a member of the Board.”
Generally, resignations are seen as formally voluntary departures. Still, CEOs may also be pressured to resign. In fact, 76% of the time “resign” was used in CEO departure announcements over the past 12 months, the departing chief executive received a Push-out Score above the critical threshold of 5, indicating elevated pressure.
Share price increase since June 2022
The announcement follows an increase in World Wrestling Entertainment Inc.’s share price of 31% since June 2022. June 2022 is the month in which McMahon’s tenure as CEO began.
In the position of CEO since 2022
Stephanie McMahon became CEO of the Company in 2022.
On June 22, 2022, World Wrestling Entertainment stated: “On June 17, 2022, World Wrestling Entertainment, Inc. (the “Company”) and its Board of Directors announced that a special committee of independent members of the Board of Directors (the “Special Committee”) is conducting an investigation into alleged misconduct by the Company’s Chairman and Chief Executive Officer, Vincent K. McMahon, and another executive. Effective immediately, McMahon has voluntarily stepped back from his responsibilities as Chairman and Chief Executive Officer until the conclusion of the investigation. Effective as of June 17, 2022, the Special Committee appointed Stephanie McMahon, Chief Brand Officer and a director of the Company, to serve as the Company’s interim Chief Executive Officer and interim Chairwoman.”
On July 27, 2022, WWE stated: “On July 22, 2022, the Board appointed Stephanie McMahon, Chief Brand Officer, interim Chief Executive Officer, interim Chairwoman and a director of the Company, and Nick Khan, President, Chief Revenue Officer and a director of the Company, to serve as the Company’s Co-Chief Executive Officers. The Board has also appointed Stephanie McMahon to serve as the Company’s Chairwoman. The appointments were made effective as of July 22, 2022.”
Stephanie McMahon served as the Company’s Chief Brand Officer since November 2013.
McMahon received her B.S. from Boston University in Communications and has been named a Distinguished Alumni by its School of Communications.
McMahon is the daughter of Vince McMahon.
At the time of Stephanie McMahon’s appointment as co-Chief Executive Officer at WWE, Stephanie McMahon and Nick Khan stated: “We are grateful for the opportunity to lead WWE together with our unmatched management team. We recognize this is a tremendous opportunity and responsibility, and we look forward to serving the WWE Universe.”
47 words by Stephanie McMahon
In the news release announcing her departure as CEO of World Wrestling Entertainment Inc., Stephanie McMahon received praise and thanks.
In the announcement of the leadership change, Stephanie McMahon kept it short and said 47 words.
“The greatest company in the world”
Stephanie McMahon stated: “I cannot put into words how proud I am to have helped lead what I consider to be the greatest company in the world and I am confident WWE is in the perfect position to continue to provide unparalleled creative content and drive maximum value for shareholders.”
Over the past 12 months, 26% 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 108 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 339 CEO departures in the Russell 3000 Index evaluated over the past 12 months (January 11, 2022, to January 10, 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, one in three departing CEOs were forced out or fired.
Pressure in the communication sector far above the critical threshold
Some industries are under generally higher pressure than others, and CEOs are feeling the strain. In the past 12 months, the consumer staples, communication 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 communication sector, which includes World Wrestling Entertainment Inc., the average Push-out Score over the past 12 months was 7.1, which is far above the critical threshold of 5.
In the communication sector, six 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.
Closer look at female CEOs
Female CEOs in the U.S. have been found to be more likely to be pushed out than male CEOs. Over the past 12 months, outgoing female CEOs have received an average Push-out Score of 6.4, considerably above the average Push-out Score of 5.6 for outgoing male CEOs.
Female CEOs have a 37% shorter tenure. Women in the role step down after an average tenure of 5.4 years, compared with 8.6 years for men, the exechange data shows, which covers 25 departing female CEOs and 314 departing male CEOs.
On a five-year view, departing female CEOs received an average Push-out Score of 5.8, which was significantly higher than the average Push-out Score of 5.3 for departing male CEOs. This suggests that women were more likely to be pushed out than men, even when using a longer observation period. This is evident from exechange data covering 1,403 CEO departures (84 of them women and 1,319 men) from 2017 to 2021. Female CEOs who announced their departure from 2017 to 2021 had a 26% shorter tenure, exiting after an average of 6.6 years, compared with 8.9 years for men, the exechange data shows.
Push-out Score for Stephanie McMahon’s move determined
The Push-out Score regarding Stephanie McMahon’s move is explained point by point in the exechange report.
exechange reached out to WWE and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 3.2023 ($).