- After almost nine years in the position
- Accolades, praise and thanks for Caforio
- Chris Boerner taking over
- Caforio will remain as Executive Chairman at Bristol-Myers
- Caforio spoke at length and said 172 words
(exechange) — New York, April 26, 2023 — Giovanni Caforio, chief executive of Bristol-Myers, is set to leave his position. His upcoming departure is made public at an early stage. As announced by Bristol-Myers Squibb Co. in a news release and in a regulatory filing published on Wednesday, April 26, 2023, Giovanni Caforio leaves his post as chief executive officer at the drugmaker, after almost nine years in the role, effective November 1, 2023.
The average tenure of CEOs who announced their departure over the past 12 months was 7.8 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.
Giovanni Caforio’s duties as CEO will be taken over by Christopher (Chris) Boerner, most recently Chief Commercialization Officer at Bristol-Myers Squibb Co.
“Thoughtful, ongoing succession planning”
The planned management change is explained as follows. Theodore R. Samuels, Lead Independent Director, stated: “Together with Giovanni, our Board of Directors has been engaged in thoughtful, ongoing succession planning and talent development discussions, and today’s announcement enables a smooth transition of the CEO role.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (27.4% of cases), implementation of a planned succession (16.2%) and the statement that the time was right for a change (9.9%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (6.4% of cases), personal reasons (3.8%) and conduct issues (2.2%). Rather rarely stated reasons are health problems (1.6% of cases), disagreement (1.3%), death (1.3%), the desire for more time with family (1%) and career change (0.6%). Sometimes, more than one reason was given. In 28.3% of cases, no reason was given.
Caforio will remain as Executive Chairman at Bristol-Myers
Bristol-Myers stated: “After November 1, 2023, Caforio will continue to serve as Executive Chairman for a transition period to be determined by the Board. Theodore R. Samuels will continue to serve as Lead Independent Director.”
Bristol-Myers said: “Giovanni Caforio, MD, Chairman of the Board and Chief Executive Officer, has decided to retire as Chief Executive Officer, effective November 1, 2023.”
Generally, retirements are seen as formally voluntary departures. Still, CEOs may also be pressured to accelerate their retirement plans. In fact, 37% of the time “retire” was used in CEO departure announcements over the past 12 months, the departing chief executives received Push-out Scores above the critical threshold of 5, indicating elevated pressure.
Share price increase since April 2018
The announcement follows an increase in Bristol-Myers Squibb Co.’s share price of 13% since April 2018.
In the position of CEO since 2015
Giovanni Caforio became CEO of the Company in 2015.
Giovanni Caforio, MD, has been chief executive officer of Bristol Myers Squibb since May 2015 and has been serving on the company’s Board of Directors since June 2014.
In May 2017, he assumed the role of chairman of the board.
Prior to becoming CEO, Caforio served as chief operating officer with responsibility for leading a fully integrated worldwide commercial organization and the companywide functions of Enterprise Services and Global Manufacturing & Supply.
This was preceded by his work as the company’s chief commercial officer.
Caforio joined Bristol Myers Squibb in 2000 as vice president and general manager, Italy, in the Worldwide Medicines Group.
He assumed added responsibility for Greece and Israel in 2001, and for South East Europe in 2003.
In 2004, he was appointed senior vice president, European Marketing and Brand Commercialization.
In 2007, he relocated to the U.S. to assume the role of senior vice president, U.S. Oncology. In 2010, he was named senior vice president, Global Commercialization, Oncology and Immunology, before becoming president of the company’s U.S. organization in 2011.
Prior to joining Bristol Myers Squibb, Caforio spent 12 years with Abbott Laboratories in a number of leadership positions.
Born and educated in Italy, Caforio received his MD from the University of Rome.
172 words by Giovanni Caforio
In the news release announcing his departure as CEO of Bristol-Myers Squibb Co., Giovanni Caforio received accolades, praise and thanks.
In announcing his departure, Giovanni Caforio spoke at length and said 172 words.
“Spending more time with my family in Europe”
Giovanni Caforio stated: “Chris is an exceptional leader, and the Board and I believe he is the right person to guide Bristol Myers Squibb through its next chapter. Chris’s expertise has been integral to our commercial success during his tenure at BMS. His strategic focus and passion for science, coupled with his commitment to patients make him uniquely suited for the role. I am confident the team will capitalize on our significant growth opportunities under Chris’s leadership… As a physician, I am passionate about new medicines that can transform how serious diseases are treated – it is why my 23 years at Bristol Myers Squibb have been the most fulfilling of my professional career. Supported by the best people in the industry, Bristol Myers Squibb has built a rich history of innovation and pioneering new treatments and is well positioned for the future. As I shift my focus to spending more time with my family in Europe, I’d like to express my deepest gratitude to our talented and dedicated team for their unwavering commitment to patients.”
Over the past 12 months, 25% 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, 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.
40% 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 314 CEO departures in the Russell 3000 Index evaluated over the past 12 months (April 26, 2022, to April 25, 2023), the average Push-out Score was 6.2, according to exechange data. References to conduct issues, disagreements and irregularities lead to the highest Push-out Scores. When performance issues, pursuit of other opportunities or time with family were cited as departure reasons, the average Push-out Scores were also significantly elevated.
Around 40% 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, two in five departing CEOs were forced out or fired.
Push-out Score for Giovanni Caforio’s move determined
The Push-out Score regarding Giovanni Caforio’s move is explained point by point in the exechange report.
exechange reached out to Bristol-Myers and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 18.2023 ($).