- After almost eight years in the position
- Praise, thanks and good wishes for DeGaynor
- Jim Zizelman taking over
(exechange) — Novi, Michigan, January 31, 2023 — Jon DeGaynor, chief executive of Stoneridge, leaves his position. As announced by Stoneridge Inc. in a news release and in a regulatory filing published on Tuesday, January 31, 2023, Jonathan B. (Jon) DeGaynor has left his post as chief executive officer at the manufacturer of electronic systems for the automotive, commercial, off-highway and agricultural vehicle markets, after almost eight years in the role, effective January 30, 2023.
The average tenure of CEOs who announced their departure over the past 12 months was 8.5 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.
Jon DeGaynor’s duties as CEO will be taken over by James (Jim) Zizelman, most recently President of the Control Devices Division at Stoneridge Inc.
“Personal reasons”
Jon DeGaynor’s departure from the CEO post is explained as follows. Stoneridge stated: “Stoneridge’s current president and chief executive officer, Jon DeGaynor, has elected to resign from the Company and the Company’s Board of Directors for personal reasons.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (27.3% of cases), implementation of a planned succession (16%) and the statement that the time was right for a change (9.2%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (5.6% of cases), personal reasons (3%) and conduct issues (2.1%). Rather rarely stated reasons are career change (2.1% of cases), health problems (1.8%), death (0.9%), the desire for more time with family (0.6%) and disagreement (0.6%). Sometimes, more than one reason was given. In 30.9% of cases, no reason was given.
Precise information regarding Jon DeGaynor’s future plans was not immediately available.
“Resign/stepped down”
Stoneridge said: “Stoneridge’s current president and chief executive officer, Jon DeGaynor, has elected to resign.”
Stoneridge further said: “Jonathan B. DeGaynor stepped down from his role as President and Chief Executive Officer and as a member of the Board of Directors (the “Board”) of the Company effective as of 5:00 PM EST on January 30, 2023.”
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 decline since January 2020
The announcement follows a decline in Stoneridge Inc.’s share price of 21% since January 2020.
In the position of CEO since 2015
Jon DeGaynor became CEO of the Company in 2015.
DeGaynor served as the President and Chief Executive Officer (“CEO”) of the Company and served in this role since March 2015.
DeGaynor served as the Vice President-Strategic Planning and Innovation of Guardian Industries Corp. (“Guardian”), a manufacturer of industrial glass and other building products for commercial, residential and automotive applications, from October 2014 until March 2015.
Prior to that, DeGaynor served as Vice President-Business Development, Managing Director Asia for SRG Global, Inc., a Guardian company, and manufacturer of chrome plated plastic parts for the automotive, commercial truck and consumer goods industries, from August 2008.
No statement by Jon DeGaynor
In the news release announcing his departure as CEO of Stoneridge Inc., Jon DeGaynor received praise, thanks and good wishes.
The announcement of his departure as CEO does not include a statement by Jon DeGaynor.
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 109 words. The longest statement was 510 words. The shortest statement was 23 words. Leadership transitions in which departing CEOs provide conspicuously short 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, according to exechange data.
35% 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 337 CEO departures in the Russell 3000 Index evaluated over the past 12 months (January 31, 2022, to January 30, 2023), the average Push-out Score was 5.8, 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 35% 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 consumer discretionary sector well 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 communication, health care and consumer staples 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 consumer discretionary sector, which includes Stoneridge Inc., the average Push-out Score over the past 12 months was 6.5, which is well above the critical threshold of 5.
In the consumer discretionary sector, 22 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 Jon DeGaynor’s move determined
The Push-out Score regarding Jon DeGaynor’s move is explained point by point in the exechange report.
exechange reached out to Stoneridge and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 6.2023 ($).