- After about eight years in the position
- Praise, thanks and words of regret for Kean
- Kim Dang taking over
- Kean spoke at length and said 131 words
(exechange) — Houston, Texas, January 18, 2023 — Steve Kean, chief executive of Kinder Morgan, is set to leave his position. His upcoming departure is made public at an early stage. As announced by Kinder Morgan Inc. in a news release on Wednesday, January 18, 2023, Steven J. (Steve) Kean leaves his post as chief executive officer at the pipeline operator, after about eight years in the role, effective August 1, 2023.
The average tenure of CEOs who announced their departure over the past 12 months was 8.3 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.
Steve Kean’s duties as CEO will be taken over by Kimberly A. (Kim) Dang, currently President at Kinder Morgan Inc.
“Sorry to lose him as our CEO”
Kinder Morgan did not give an explicit reason for Steve Kean’s planned departure from the CEO post. Richard D. Kinder, KMI Executive Chairman, stated: “Steve has done a superb job as CEO… While we will be sorry to lose him as our CEO in August, we are delighted that he will continue to be a director and know he will contribute in that role to the future success of Kinder Morgan.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (27% of cases), implementation of a planned succession (16.1%) and the statement that the time was right for a change (8.8%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (5.9% of cases), personal reasons (2.9%) and conduct issues (2.3%). Rather rarely stated reasons are health problems (2.1% of cases), career change (2.1%), death (0.9%), the desire for more time with family (0.6%) and disagreement (0.6%). Sometimes, more than one reason was given. In 30.8% of cases, no reason was given.
Precise information regarding Steve Kean’s future plans was not immediately available.
Kinder Morgan said: “After over 20 years with Kinder Morgan, the last 8 years as CEO, Steve Kean has announced his intention to transition out of his role as CEO effective August 1, 2023. He will remain on the KMI Board of Directors.”
Companies often provide less precise information in their corporate announcements than in regulatory filings, which are sometimes published with a considerable delay and therefore cannot always be included in the exechange analysis. In the present case, a regulatory filing regarding Steve Kean’s move was not available at the time of the analysis.
Share price increase since January 2022
The announcement follows an increase in Kinder Morgan Inc.’s share price of 15% since January 2022.
In the position of CEO since 2015
Steve Kean became CEO of the Company in 2015.
Kean is Director and Chief Executive Officer of KMI.
He has served as a director of KMI or its predecessors since 2007; served as Chief Executive Officer since 2015; and as President from 2013 to April 2018.
He also served as Chairman of the Board and Chief Executive Officer of Kinder Morgan Canada Limited (KML) from 2017 until its sale in December 2019. Kean has served in various management roles for the Kinder Morgan companies since 2002 and in senior executive roles since 2006.
He was Executive Vice President and Chief Operating Officer of KMI and its predecessors from 2006 until 2013, when he was named President and Chief Operating Officer, and served in that capacity until he assumed the Chief Executive Officer role in 2015.
Kean also served as President, Chief Operating Officer and Director of KMR from March 2013 to November 2014, and of KMGP from 2013 to 2015, when he was named President, Chief Executive Officer and Director of KMGP.
He served as Director, President and Chief Operating Officer of the general partner of EPB from 2013 until 2015.
Kean received his Juris Doctor from the University of Iowa in 1985 and received a Bachelor of Arts degree from Iowa State University in May 1982.
131 words by Steve Kean
In the news release announcing his departure as CEO of Kinder Morgan Inc., Steve Kean received praise, thanks and words of regret.
In announcing the leadership change, Steve Kean spoke at length and said 131 words.
“To undertake work in other areas of interest to me”
Steve Kean stated: “I am grateful for the opportunity to serve this great company. I am immensely proud of the business this team has built, the strength of the organization and its culture, and the promising future we have before us. Among our strengths is the great care we routinely and deliberately take in planning for succession, including the development of the best leaders for the future of Kinder Morgan. Kim, Tom, and the rest of the Kinder Morgan team will lead this company on to even greater things. The best is yet to come, and I look forward to continuing active involvement with the company as a member of the Board. I personally also look forward to having the flexibility to undertake work in other areas of interest to me in the future.”
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.
34% 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 341 CEO departures in the Russell 3000 Index evaluated over the past 12 months (January 18, 2022, to January 17, 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 time with family, performance issues or other opportunities were cited as departure reasons, the average Push-out Scores were also significantly elevated.
Around 34% 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 energy sector substantially 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 energy sector, which includes Kinder Morgan Inc., the average Push-out Score over the past 12 months was 5.8, which is substantially above the critical threshold of 5.
Push-out Score for Steve Kean’s move determined
The Push-out Score regarding Steve Kean’s move is explained point by point in the exechange report.
exechange reached out to Kinder Morgan and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 4.2023 ($).