Retaining the C-Suite After CEO Turnover

Five years ago, FW Cook studied the effectiveness of special one-time retention grants made to the C-suite after CEO turnover. In 2025, we have taken a refreshed look at the same topic, which both supports the findings of the original study and discovers additional insights.

The appointment of a new CEO – whether promoted internally or recruited from the outside – results in a period of significant change for an organization. For such a change to be successful, stability in the rest of the leadership team can be paramount, particularly for highly-valued leaders who can support the new CEO as he or she settles into the new role. Companies often make special equity grants to the rest of the C-suite in order to bolster such stability.

Our new study confirms that retention grants made to executives who were not promoted to the CEO role have a clear effect, retaining C-suite leaders for an additional two to three years longer than leaders who do not receive such grants. In addition, the study finds:

• Grant prevalence and design have remained consistent over time, but have increased in value in step with annual executive compensation rates
• Companies that recruit CEOs externally are twice as likely to make special retention grants
• Outside of special retention grants, the total value of outstanding equity has a measurable impact on how long executives remain with an organization following CEO turnover