RT Journal Article
SR Electronic
T1 Increasing the Odds of Having the Right CEOs Running Portfolio Companies
JF The Journal of Private Equity
FD Institutional Investor Journals
SP 7
OP 11
DO 10.3905/jpe.2017.20.2.007
VO 20
IS 2
A1 Matt Brubaker
A1 MaryCay Durrant
A1 Josh Kuehler
YR 2017
UL https://pm-research.com/content/20/2/7.abstract
AB Our research and experience in helping PE executives evaluate and develop CEOs and members of their senior management teams suggests that PE firms frequently evaluate CEOs or CEO candidates on the wrong criteria. Research by Bain & Company found PE firms replaced nearly half the CEOs of the companies they owned. Additionally, in 60% of those instances, the PE firm didn’t expect to replace the CEO when it bought the firm. By too often keeping or hiring the wrong CEOs, PE firms are leaving growth opportunities on the table. Why does this happen? Over the past eight years, FMG Leading evaluated 181 leaders of PE-backed companies and conducted structured interviews with more than 2,000 executives who worked with, for, or over them to identify trends in traits of the best leaders.TOPICS: Private equity, manager selection, quantitative methods