CRIST KOLDER ASSOCIATES. Volatility Report 2018

Transcription

1 CRIST KOLDER Volatility Report 2018

2 CRIST KOLDER Volatility Report Table of Contents Methodology Page 2 Report Highlights Page 5 Location Page 6 Executive Turnover Page 9 C-Suite Career Paths Page 18 Diversity Landscape Page 36 Education Background Page 44 Crist Kolder 2018 Volatility Report 1

3 Methodology The annual Crist Kolder Volatility Report of America s Leading Companies examines the backgrounds and measures the turnover of C-Suite executives in a portfolio of 673 of America s leading companies from the Fortune 500 and the S&P 500 Indexes. Crist Kolder Associates examines each of the portfolio companies individually, noting personnel and organizational changes in the CEO, CFO, and COO roles. Each executive s background is explored, including the path taken to get to their current role: industry background, functional experience, and education. This includes demographic information such as age, gender, and race. This is the fifteenth year of the Crist Kolder Volatility Report, though information for the report goes back to This Summer 2018 release of the Crist Kolder Volatility Report contains data through August 1,

4 Methodology Notes 2018 Fortune 500 and S&P 500 Companies (673 Total) Companies Removed from 2017: 30 Companies Added: 30 Public Companies: 644 Private Companies: 29 Color Key Blue = CEO Green = CFO Purple = COO Graphs and data correspond with the color key above Data tracked January 1, 1995 through August 1, 2018; update occurs every December Industries broken down by Fortune s classification system and then grouped into designated larger categories based on SIC codes and judgment of Crist Kolder Associates Resources: Bloomberg: Businessweek: Capital IQ: Fortune: LinkedIn: SEC Company Filings: Yahoo Finance: Individual company websites Healthcare 10.25% Company Industry Breakdown Consumer 9.51% Energy 11.14% Technology 12.18% Retail 7.43% Financial 20.95% Services 12.63% Industrial 15.90% 3

5 Definitions Turnover: The rate at which there is a new hire for a C-Suite position Volatility: Turnover is noted when the executive starts in the new role (as opposed to the date of announcement) Internal change: An executive is promoted to a role at the company where he/she is already employed External change: An executive is recruited to a position at a company to which his/her previous position has no formal ties Mergers: In a merger of equals, the combined company is considered a new entity. A change in leadership, therefore, is marked for all mergers. A change is internal if the executive was previously employed by either of the merging companies Acquisitions: In the event an executive from the acquired company is appointed to a role in the acquiring company, it is an internal change Partial year: Designation indicates data gathered up to August 1, 2018, not a projection COO Role: If no individual operates under the title of COO at a given company, description of duties, executive hierarchy, and compensation are simultaneously analyzed to determine if someone with another title fulfills this role 4

6 Report Highlights As the S&P 500 reaches historic price levels, C-Suite turnover is projected to reach an all-time high by year-end (Page 14) Companies are beginning to look at more outside talent when hiring a CEO (Page 15) The number of companies with a COO continues to decrease (Page 16) CEOs primarily transition from a President/COO chair or a Divisional President position (Page 19) C-Suite transitions from the CFO role to the CEO role have increased in 2018 (Page 21) Less than 20% of sitting CFOs have prior CFO experience at another company (Page 24) Technology sector CFOs usually have the least amount of company experience before taking their position (Page 28) The average age of hire for C-Suite positions has risen 15% since 2005 (Page 31) Less than 10% of CFOs are over 60 years of age (Page 35) The count of Female CFOs has reached an all-time high (Page 37) In both the CEO and CFO positions, diversity is at an all-time high (Page 40, 42) Within the United States, more CEOs attended schools in the Big Ten than in any other conference (Page 45) The Big Ten Conference has claimed the most sitting CFOs for more than five consecutive years (Page 47) 64% of CEOs have an advanced degree, while 50% of CFOs have an MBA (Pages 53, 54) The path to the C-Suite runs through eight leading MBA programs (Page 55) 5

7 Location 6

8 Company Headquarters by Location 2018 Fortune 500 and S&P 500 (673 Companies) *Non-shaded (white) states have no company headquarters located within that state 7

9 Industry Breakdown by Region 100% 2018 Fortune 500 and S&P 500 (673 Companies) 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Industrial Healthcare Services Technology Retail Energy Financial Consumer Midwest 38.3% 20.3% 15.3% 3.7% 30.0% 16.0% 25.5% 31.3% South 25.2% 15.9% 32.9% 20.7% 40.0% 60.0% 19.1% 20.3% Northeast 22.4% 37.7% 29.4% 22.0% 14.0% 13.3% 36.2% 32.8% West 8.4% 20.3% 20.0% 48.8% 16.0% 9.3% 17.0% 12.5% Foreign 5.6% 5.8% 2.4% 4.9% 0.0% 1.3% 2.1% 3.1% Regions: Northeast, Midwest, South, and West as determined by the United States Census Bureau 8

10 Executive Turnover 9

11 COO turnover continues to increase in % 30% CEO/CFO/COO Volatility ( ) 2018 Fortune 500 and S&P 500 Companies (673 Companies; 679 Sitting CEOs; 670 Sitting CFOs; 215 Sitting COOs) COO Historical Average: 21.7% Percent Turnovers 25% 20% 15% 10% 5% CFO Historical Average: 15.1% CEO Historical Average: 11.1% 0% * CEO 8.1% 10.4% 11.9% 11.9% 12.0% 14.7% 12.9% 10.4% 9.3% 11.9% 14.1% 9.6% 10.0% 11.8% 8.8% 8.5% 11.5% 9.5% 11.8% 9.9% 11.8% 12.3% 10.3% 13.4% CFO 13.5% 12.4% 16.2% 15.8% 17.5% 17.9% 15.3% 13.8% 12.1% 14.3% 16.0% 17.2% 17.3% 18.3% 13.4% 12.3% 11.8% 11.4% 17.1% 15.4% 14.8% 17.7% 15.8% 16.6% COO 16.1% 16.6% 24.7% 19.7% 25.6% 21.3% 16.1% 18.1% 17.8% 22.0% 20.4% 24.2% 21.6% 19.9% 19.8% 19.8% 23.1% 22.8% 17.6% 20.8% 23.9% 23.4% 30.4% 32.0% *Projection of 2018 year end Partial year: CEO: 9.6% CFO: 10.9% 10 COO: 21.9%

12 The Industrial and Technology sectors account for the most CEO turnover* CEO Volatility by Industry 2018 Fortune 500 and S&P 500 (673 Companies) Notable CEO changes in 2018 Healthcare 7.7% Energy 7.7% Services 12.3% Consumer 13.8% Financial 13.8% Cardinal Health, Inc. Chevron Corp. Verizon Communications, Inc. Lowe s Companies, Inc. Intel Corp. Sysco Corp. 3M Company American Express Company Retail 7.7% Industrial 18.5% Technology 18.5% *Year to date 11

13 The Retail sector has the lowest CFO turnover* CFO Volatility by Industry 2018 Fortune 500 and S&P 500 (673 Companies) Consumer 12.3% Healthcare 12.3% Technology 13.7% Energy 13.7% Notable CFO Changes in 2018 CVS Health Corp. Adobe Systems, Inc. General Motors Company Walgreens Boots Alliance, Inc. Valero Energy Corp. International Business Machines Corp. MetLife, Inc. HP, Inc. Services 11.0% Retail 6.8% Industrial 15.1% Financial 15.1% *Year to date 12

14 The Financial sector constitutes over a third of COO turnover* COO Volatility by Industry 2018 Fortune 500 and S&P 500 (673 Companies) Retail 4.3% Healthcare 4.3% Technology 8.5% Consumer 8.5% Energy 10.6% Industrial 12.8% Notable COO Changes in 2018 JPMorgan Chase & Company Express Scripts Holding Company Valero Energy Corp. United Parcel Service, Inc. Pfizer, Inc. HP, Inc. Northrop Grumman Corp. Philip Morris International, Inc. Services 14.9% Financial 36.2% *Year to date 13

15 C-Suite turnover is projected to reach an all-time high Overall Volatility and S&P 500 Index** ( ) 2018 Fortune 500 and S&P 500 (673 Companies) 20% % CEO/CFO/COO Historical Average 14.4% 16% % 2000 C-Suite Turnover 12% 10% 8% 6% S&P 500 Historical Average S&P 500 Index 4% 500 2% 0% * CEO/CFO/COO 11.6% 12.2% 15.8% 14.8% 16.6% 17.2% 14.4% 13.1% 11.9% 14.6% 15.9% 15.1% 14.9% 15.8% 12.5% 11.9% 13.5% 12.5% 14.9% 13.9% 14.9% 16.2% 15.5% 18.7% S&P 500 Index Crist Kolder 2018 Volatility Report *Projection of 2018 year end Partial year C-Suite Turnover: 11.6% **Average Daily Close 14

16 The rate of external hiring for CEO succession is projected to reach an all-time high Percentage of CEOs/CFOs Recruited from Outside the Company ( ) 2018 Fortune 500 and S&P 500 Companies (673 Companies; 679 Sitting CEOs; 670 Sitting CFOs) 60% 50% CFO Historical Average: 38.6% % Externally Recruited 40% 30% 20% CEO Historical Average: 21.5% 10% 0% * CEO 9.5% 20.0%18.5%13.4%20.3%19.8%23.4%17.5%21.1%23.0%24.4%25.8%16.9%32.5%25.9%19.6%27.6%25.4%25.3%18.2%16.5%12.0%30.0%33.9% CFO 44.8%37.1%39.3%33.3%37.5%43.6%31.8%58.0%34.7%34.9%39.4%45.9%40.9%41.9%40.7%24.1%35.1%38.7%34.5%40.2%36.1%36.4%43.4%39.8% Crist Kolder 2018 Volatility Report *Projection of 2018 year end Partial year: CEO: 24.1% CFO: 28.8% 15

17 The number of companies with a COO has decreased by almost 15% in the last ten years Percentage of Companies with a COO ( *) 2018 Fortune 500 and S&P 500 (673 Companies; 215 Sitting COOs) 55% 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% * % with COO 48.0% 44.7% 45.5% 44.9% 44.4% 43.9% 43.8% 46.0% 44.3% 42.2% 41.6% 41.5% 39.6% 36.3% 36.0% 33.6% 35.3% 33.0% 31.5% *Partial Year 16

18 The COO role is least common within the Technology sector Percentage of Companies with a COO by Industry 2018 Fortune 500 and S&P 500 Companies (673 Companies; 215 Sitting COOs) 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Financial Services Retail Consumer Energy Industrial Healthcare Technology % With COO 43.0% 36.5% 34.2% 30.3% 31.1% 25.2% 24.6% 22.6% 17

19 C-Suite Career Paths 18

20 Over 75% of Sitting CEOs were elevated from general management roles 30% Immediate Previous Position of Sitting CEOs (Internal or External) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) 25% 20% 15% 10% 5% 0% % from Position Divisional President COO President CFO President/COO CEO Other Operaring Executive 27.0% 26.5% 16.3% 6.8% 6.5% 6.3% 4.1% 3.8% 2.7% Founder Internal Divisional President includes CEO of subsidiary company President/COO: Executive held both President and COO roles at the same time Operations Executive: VP/SVP/EVP of Operations Other: i.e. chairman, marketing, risk, consulting, commerce, investment officer, partner, managing director, general counsel 19

21 The most common path to the CEO position is an internal promotion from the COO role 30% Immediate Previous Position of Sitting CEOs (Internal vs. External) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) 25% 20% 15% 10% 5% 0% Divisional President Internal Divisional President includes CEO of subsidiary company President/COO: Executive held both President and COO roles at the same time Operations Executive: VP/SVP/EVP of Operations Other: i.e. chairman, marketing, risk, consulting, commerce, investment officer, partner, managing director, general counsel COO President CFO President/COO CEO Other Operaring Executive External 8.0% 1.2% 0.6% 0.3% 0.0% 6.3% 0.4% 1.0% 0.0% Internal 19.0% 25.3% 15.8% 6.5% 6.5% 0.0% 3.7% 2.8% 2.7% Founder 20

22 C-Suite transitions from the CFO role to the CEO role have increased in % Percentage of Sitting CEOs coming directly from a CFO Chair (Internal or External) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) 8% 7% 6% 5% 4% 3% 2% 1% 0% % from CFO Role 5.6% 5.8% 6.2% 6.5% 7.8% 6.2% 6.9% 21

23 CFO movement to the CEO position is most prominent in the Financial sector Percentage of Sitting CEOs coming from a CFO Chair by Industry (Internal or External) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 46 CEOs Represented) 30% 25% 20% 15% 10% 5% 0% Financial Industrial Technology Services Energy Consumer Healthcare Retail % from CFO 28.3% 17.4% 17.4% 10.9% 10.9% 8.7% 4.3% 2.2% 22

24 CEOs in the Financial sector hold the most Chairman titles 70 Sitting CEOs that are also Chairman* 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 287 Sitting CEOs that are also Chairman) 60 Count of CEOs that are also Chairman Financial Industrial Services Energy Healthcare Consumer Technology Retail CEO and Chairman * Sitting Chairman of their current company 23

25 Less than 20% of sitting CFOs have prior CFO experience at another company 20% Percentage of Sitting CFOs by Immediate Previous Position (Internal or External) 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% CFO Corporate Controller / Chief Accounting Officer Corporate Finance Treasurer Divisional CFO Divisional President/ Operations Executive Strategy/ M&A Other President/ COO Investor Relations CEO Chief Administrative Officer % from Position 18.5% 18.4% 16.9% 11.3% 10.8% 8.9% 6.8% 4.1% 2.0% 1.4% 0.6% 0.5% Internal Divisional Finance Officer includes CFOs of subsidiary companies External CFO recruitment means previous CFO of another company Operations Executive: President, VP/SVP/EVP Operations Corporate Finance Executive: VP, SVP, EVP of Finance Strategy/M&A: Investment Banking, Development, Planning or Strategy Other: tax, law, IT, risk, consulting, etc. 24

26 Internally promoted CFOs most often transition from the Corporate Controller or Chief Accounting Officer role 20% Percentage of Sitting CFOs by Immediate Previous Position (Internal or External) 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% CFO Corporate Controller / Chief Accounting Officer Corporate Finance Treasurer Divisional CFO Divisional President/ Operations Executive Strategy/ M&A Other President/ COO Investor Relations CEO Chief Administrative Officer External 18.5% 2.3% 1.7% 0.8% 3.0% 1.8% 1.4% 1.7% 0.9% 0.5% 0.45% 0.0% Internal N/A 0.0% 16.1% 15.1% 10.5% 7.8% 7.1% 5.4% 2.4% 1.1% 0.9% 0.15% 0.5% Internal Divisional Finance Officer includes CFOs of subsidiary companies External CFO recruitment means previous CFO of another company Operations Executive: President, VP/SVP/EVP Operations Corporate Finance Executive: VP, SVP, EVP of Finance Strategy/M&A: Investment Banking, Development, Planning or Strategy Other: tax, law, IT, risk, consulting, etc. 25

27 Only 39% of CFOs have public accounting experience 2018 CFOs with Public Accounting Backgrounds 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs; 261 CFOs Represented*) CFO Public Accounting Statistics Total Sitting CFOs: 670 Public Accounting Background: 261 Percentage of Total CFOs: 39% Big Five Firm Background: 211 Percentage of Total CFOs: 31.4% 31 Non-Big Five Firm Background: 50 Percentage of Total CFOs: 7.5% *Multiple CFOs have worked for more than one Big Five public accounting firm Crist Kolder 2018 Volatility Report 26

28 12% of CFOs have investment banking experience 2018 CFOs with Investment Banking Backgrounds 2018 Fortune 500 and S&P 500 (673 Companies; 84 CFOs Represented*) Goldman Sachs 16 Merrill Lynch (Bank of America) 15 J.P. Morgan Chase & Co. 13 Morgan Stanley 9 CFO Investment Banking Statistics Total Sitting CFOs: 670 Deutsche Bank 7 Investment Banking Background: 83 Percentage of Total CFOs: 12.3% UBS 5 *Multiple CFOs have worked for more than one investment bank 27

29 Technology sector CFOs have the least amount of company experience before taking their position 18 Average Years of Experience with Company before assuming Roles of CEO/CFO/COO at that Company* 2018 Fortune 500 and S&P 500 (673 Companies; 558 Internal CEOs Hires; 450 Internal CFO Hires; 192 Internal COO Hires) Years Average Retail Healthcare Energy Consumer Services Technology Financial Industrial CEO CFO COO *From start date with company to date of C-Suite appointment 28

30 Financial sector CEOs have the longest tenure Average Tenure of CEO by Industry 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) Longest Tenured CEO Leslie Wexner L Brands, Inc. (54.6 Years) Average CEO Tenure: 6.5 years Tenure (Years) Financial Retail Technology Healthcare Services Energy Consumer Industrial 29

31 The average tenure of a CFO is over 5 years Average Tenure of CFO by Industry 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) 7 6 Longest Tenured CFO Jeffrey Julien Raymond James Financial, Inc. (31.3 Years) Average CFO Tenure: 5.1 years Tenure (Years) Retail Financial Industrial Services Consumer Technology Energy Healthcare 30

32 The C-Suite is getting older Age of Hire for CEOs and CFOs 2018 Fortune 500 and S&P 500 (673 Companies; 674 Known CEO Ages at Hire; 660 Known CFO Ages at Hire) Average Age of Hire CEO CFO

33 Nearly 25% of CEOs were appointed to their position before Age of Hire for Sitting CEOs 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 674 Known CEO Ages at Hire) Age at Hire of Sitting CEOs Youngest Male(s): Mark Zuckerberg Facebook, Inc. (19) Youngest Male(s): Michael Dell Dell Technologies (19) Oldest Male: Stefano Pessina Walgreens Boots Alliance (73) Youngest Female: Deborah Cafaro Ventas, Inc. (40) Oldest Female: Kathryn Marinello Hertz Global Holdings, Inc. (60) Age Male Female 32

34 Nearly 75% of Female CEOs are 55 and older Age Distribution of Sitting CEOs 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 674 Known CEO Ages) Average Age of Sitting CEOs Male: 57 Female: 56 Age Range of Sitting CEOs Youngest Male: Mark Zuckerberg Facebook, Inc. (34) Oldest Male: Warren Buffett Berkshire Hathaway, Inc. (87) Youngest Female: Joey Wat Yum China Holdings, Inc. (46) Oldest Female: Marillyn Hewson Lockheed Martin Corporation (64) Age Male Female 33

35 Over 60% of newly appointed CFOs were younger than Age of Hire of Sitting CFOs 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs; 660 Known CFO Ages at Hire) Age at Hire of Sitting CFOs Youngest Male: David Knopf Kraft Heinz Company. (29) Oldest Male: Joseph Macnow Vornado Realty Trust (66) Youngest Female: Karla Lewis Reliance Steel & Aluminum Co. (33) Oldest Female(s): Christine McCarthy Walt Disney Co.(60) Age Male Female 34

36 Less than 10% of CFOs are over 60 years of age Age Distribution of Sitting CFOs 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs; 660 Known CFO Ages) Average Age of Sitting CFOs Male: 53 Female: 52 Age Range of CFOs Youngest Male: David Knopf Kraft Heinz Company. (30) Oldest Male: Walter Berman Ameriprise Financial, Inc. (75) Youngest Female: Céline Dufétel T. Rowe Price Group. (35) Oldest Female(s): Virginia Wilson TIAA CREF (64) Age Male Female 35

37 Diversity Landscape 36

38 The number of Female CFOs has reached an all-time high 14% Percentages of Companies with Female CEOs or CFOs ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 670 Sitting CFOs) 12% 10% 8% 6% 4% 2% 0% CEO 1.6% 1.4% 2.1% 2.2% 2.1% 2.2% 1.9% 3.0% 3.5% 3.8% 4.9% 4.3% 4.2% 5.2% 4.6% CFO 6.3% 6.9% 6.3% 7.2% 7.3% 8.7% 8.7% 10.0% 9.7% 10.2% 10.6% 12.2% 12.3% 11.6% 12.5% 37

39 The population of Female CEOs has more than doubled in the last ten years Number of Companies with Female CEOs by Industry ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) Female CEOs Financial Energy Technology Industrial Services Retail Consumer Healthcare Total

40 The Financial sector has the most Female CFOs Number of Companies with Female CFOs by Industry ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) Female CFOs Financial Consumer Industrial Services Technology Energy Retail Healthcare Total

41 Diversity in the CEO role is at an all-time high 60 Number of Companies with Ethnically and Racially Diverse CEOs ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) Ethnically and Racially Diverse CEOs Hispanic / Latino African American Asian / Indian Total

42 For over 10 years, the Technology sector has led in diversity at the CEO position Number of Companies with Ethnically and Racially Diverse CEOs by Industry ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs) Ethnically and Racially Diverse CEOs Technology Industrial Services Financial Healthcare Consumer Energy Retail Total

43 Diversity in the CFO role is at an all-time high Number of Companies with Ethnically and Racially Diverse CFOs ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) Ethnically and Racially Diverse CFOs Hispanic / Latino African American Asian / Indian Total

44 The Financial and Technology sectors are diversity leaders at the CFO position Number of Companies with Ethnically and Racially Diverse CFOs by Industry ( ) 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs) 60 Ethnically and Racially Diverse CFOs Financial Technology Industrial Energy Consumer Services Healthcare Retail Total

45 Education Background 44

46 More CEOs come from the Big Ten Conference than any other U.S. conference Sitting CEO Undergraduate University Conference Affiliation 2018 Fortune 500 and S&P 500 Companies (679 Sitting CEOs; 651 Known Education Backgrounds) International 83 Big Ten Conference 80 Ivy League 57 Atlantic Coast Conference 46 Southeastern Conference 37 Pacific 12 Conference 33 Top Schools CEOs Patriot League 25 Harvard University University of Pennsylvania Big 12 Conference 21 University of Michigan 10 NESCAC 17 Stanford University Pennsylvania State University 9 9 Mid-American Conference 15 Cornell University

47 Canada and the United Kingdom are home to the most sitting CEOs of all foreign countries in this study Top Five International Degree Producing Countries for Sitting CEOs 2018 Fortune 500 and S&P 500 Companies (679 Sitting CEOs; 651 Known Education Backgrounds) Canada 10 United Kingdom 10 France 8 Australia 7 India 7 46

48 The Big Ten Conference has claimed the most CFOs for six consecutive years Sitting CFO Undergraduate University Conference Affiliation 2018 Fortune 500 and S&P 500 Companies (670 Sitting CFOs; 637 Known Education Backgrounds) Big Ten Conference 79 International 59 Atlantic Coast Conference 58 Ivy League 44 Pacific 12 Conference 33 Southeastern Conference 33 Top Schools CFOs Big 12 Conference 29 University of Notre Dame University of Pennsylvania Mid-American Conference 23 Indiana University University of Michigan American Athletic Conference 21 Stanford University 10 Patriot League 21 Harvard University

49 Canada is home to the most sitting CFOs of all foreign countries in this study Top Five International Degree Producing Countries for Sitting CFOs 2018 Fortune 500 and S&P 500 Companies (670 Sitting CFOs; 637 Known Education Backgrounds) Canada 15 United Kingdom 9 India 8 France 5 Germany 3 Australia 3 48

50 Public universities currently produce the most sitting CEOs Sitting CEO Undergraduate University 2018 Fortune 500 and S&P 500 Companies (679 Sitting CEOs; 651 Known Education Backgrounds) Top Public Schools CEOs University of Michigan 10 Pennsylvania State University 9 University of Virginia 8 Michigan State University 8 Private 291 Public 347 University of Wisconsin Top Private Schools 8 CEOs Harvard University 15 University of Pennsylvania 10 Stanford University 9 Cornell University 9 Princeton University 8 49

51 Public universities currently produce the most sitting CFOs Sitting CFO Undergraduate University 2018 Fortune 500 and S&P 500 Companies (670 Sitting CFOs; 637 Known Education Backgrounds) Private 277 Public 358 Top Public Schools Indiana University University of Michigan University of Texas Austin Pennsylvania State University University of Virginia Top Private Schools University of Notre Dame University of Pennsylvania Stanford University Harvard University Boston College CFOs CFOs

52 Over 60% of CEOs have an undergraduate degree in Business or Engineering Percentage of CEOs from each Educational Background 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 651 Known Education Backgrounds) Sciences 7.87%*** Other 15.31%**** Dual 8.05% Business 36.70%* Finance 16.33% Business Adminstration 39.80% Accounting 28.57% Liberal Arts 20.97%** Top Majors CEOs Engineering 26.40% *Accounting, Business Administration/Management, Finance, Other **Economics is included in Liberal Arts ***Mathematics is included in Sciences ****Marketing, International Business, Commerce, Logistics Engineering Economics Business Administration Accounting Finance

53 65% of CFOs have an undergraduate degree in Business Percentage of CFOs from each Educational Background 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs; 637 Known Education Backgrounds) Engineering 7.21% Sciences 4.04%*** Dual 4.22% Other 8.25% **** Finance 20.39% Accounting 49.03% Liberal Arts 18.80%** Business Administration 21.36% Business 65.73%* Top Majors CFOs *Accounting, Business Administration/Management, Finance, Other **Economics is included in Liberal Arts ***Mathematics is included in Sciences ****Marketing, International Business, Commerce, Logistics Accounting Economics Business Administration Finance Engineering

54 64% of CEOs possess an advanced degree CEO Terminal Degree Educational Background 2018 Fortune 500 and S&P 500 (673 Companies; 679 Sitting CEOs; 651 Known Education Backgrounds) 60% 50% MBA 40% 30% 20% Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s 10% 0% Average Overall Consumer Energy Retail Technology Services Healthcare Financial Industrial Bachelor's 36.1% 39.7% 38.0% 48.4% 35.4% 47.8% 25.0% 31.7% 31.3% MBA 44.7% 47.1% 46.5% 41.9% 36.6% 35.9% 46.9% 46.8% 53.5% Master's 8.5% 8.8% 8.5% 6.5% 14.6% 5.4% 9.4% 7.9% 7.1% JD 5.9% 1.5% 1.4% 3.2% 2.4% 9.8% 6.3% 11.5% 4.0% PhD 4.8% 2.9% 5.6% 0.0% 11.0% 1.1% 12.5% 2.2% 4.0% 53

55 50% of CFOs hold an MBA degree CFO Terminal Degree Educational Background 2018 Fortune 500 and S&P 500 (673 Companies; 670 Sitting CFOs; 637 Known Education Backgrounds) 70% 60% 50% 40% 30% 20% Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA Bachelor s MBA 10% 0% Average Overall Consumer Energy Retail Technology Services Healthcare Financial Industrial Bachelor's 40.0% 38.9% 37.1% 39.4% 33.3% 44.6% 37.1% 42.2% 42.4% MBA 48.6% 51.4% 52.9% 57.6% 53.1% 45.7% 48.4% 40.6% 50.5% Master's 7.5% 5.6% 7.1% 3.0% 9.9% 5.4% 11.3% 9.4% 6.1% JD 3.1% 4.2% 2.9% 0.0% 2.5% 3.3% 3.2% 5.5% 1.0% PhD 0.8% 0.0% 0.0% 0.0% 1.2% 1.1% 0.0% 2.3% 0.0% 54

56 The path to the C-Suite runs through eight leading MBA programs Top MBA Schools 2018 Fortune 500 and S&P 500 (673 Companies; 651 CEO and 637 CFO Known Education Backgrounds) Harvard University University of Chicago Northwestern University University of Pennsylvania Stanford University Columbia University University of Michigan 12 6 New York University 8 Number of CEOs Number of CFOs 55