One CEO change: 5.8 years. Two changes: 8.5. What does that actually show?

On October 23, 2026, Russell Reynolds Associates published a new analysis of succession at private equity and infrastructure portfolio companies. The striking historical comparison is 5.5 years of average holding time with no CEO change, 5.8 years with one change, 8.5 with two, 9.2 with three and 11.0 with four.

The figures do not prove that replacing a CEO twice added 2.7 years to an investment. Companies held longer have more time to experience multiple leadership transitions, and difficult investments may both take longer to sell and trigger more changes. The strategic question is whether leadership remained fit for the next phase.

The new October paper combines three different bodies of evidence

The October report reviews more than 250 CEO and C-suite appointments in private equity and infrastructure-backed companies in EMEA, 15 market interviews, and an earlier dataset covering 196 European private equity companies exited from 2020 through 2025. These are distinct sources, not a single 250-company cohort.

The holding-period statistics originated in Russell Reynolds' August 26 paper, The CEO Decision, which traced CEO changes across the 196 exited businesses. They are not fresh October findings or a comprehensive measurement of investment returns. Holding time is the central observed outcome.

Nearly 69% of the exited companies had changed CEO

Among the 196 businesses, 135—about 69%—experienced at least one CEO transition during ownership. Around a quarter of those experiencing change did so more than once, with an average of 2.4 transitions in the repeat-change subset.

Private equity ownership may move a business from acquisition stabilization to integration, geographic expansion, transformation and sale. Capabilities that are effective at one stage may not suffice at another. Yet the existence of phases does not imply that a CEO should automatically be replaced at each stage.

Zero changes versus one: just 0.3 years in average holding time

Businesses retaining the acquisition CEO averaged 5.5 years of ownership. Those replacing that CEO once averaged 5.8. This limited difference undermines the simple assumption that any CEO replacement necessarily destroys years of time.

But it does not show that replacement is costless. Returns, debt burdens, executive-team continuity and unrealized alternative outcomes are not captured by this single comparison. Two exits after similar holding periods could deliver very different returns. CEO transitions and investment performance must not be treated as equivalent measures.

Repeated transitions and long holds can influence each other

Average holding time rises from 8.5 years after two changes to 9.2 after three and 11.0 after four. A repeated reset can disrupt strategy, require management teams to reorient and slow execution. Equally, severe underlying market or operational issues can extend a holding period and prompt repeated changes.

Duration itself also creates exposure: an asset held for 11 years has more opportunities for leadership changes than one exited after three. The published figures cover completed exits and do not isolate the causal effects of sector, leverage, market cycle or deal complexity. One cannot mechanically assign the difference to poor executive-search decisions.

Appointed in year one: 4.4 years. After year two: 7.7 years

The August study found that businesses appointing a new CEO during their first year averaged a 4.4-year hold; those making the appointment after year two averaged 7.7. This is an association, not evidence that accelerating replacement by itself shortens the hold by 3.3 years.

Companies with a late appointment must have remained under ownership long enough to enter that category. Some early appointments may have been planned at acquisition, while later ones could follow unforeseen problems. Both the timing of the decision and the economic conditions behind it are needed before attributing causality.

Appointment date and decision date are two different clocks

A CEO might take office in the second year even though the board began searching soon after acquisition. Assessment, negotiations, notice obligations and transition planning can precede the formal start date. Conversely, a company might delay recognizing a mismatch before starting any search.

Banseog proposes separating when the capability mismatch emerged, when alternatives were examined, when a replacement or reinforcement decision was taken and when the new structure became operational. Russell Reynolds' holding-time dataset does not report a measured decision delay for every company.

Strengthening a CEO's team may be better than replacing the CEO

The October report explicitly discusses appointing a stronger CFO or COO, an experienced chair, targeted coaching and broader executive capabilities. A gap between current and future business needs is not always a defect that requires removing the chief executive.

A product-focused CEO entering international acquisitions may benefit from finance, integration and cross-border expertise elsewhere in the team. A more fundamental leadership mismatch may justify replacement. 'Is the CEO delivering now?' and 'Can the same leader deliver the next phase?' must be assessed separately.

A quoted estimate of succession readiness is not a census

One interviewed talent partner estimated that fewer than 25% of their own portfolio companies had a documented CEO succession plan. That is the judgment of an interview participant, not a statistically representative 25% measure across the private-equity industry.

Potential internal successors may accept CEO opportunities elsewhere rather than wait through a long holding period. External candidates can also be scarce once a firm requires experience with a particular industry, scale, ownership structure and growth stage. Succession readiness means keeping credible internal and external options available.

Why can investment committees hesitate to reassess leadership?

An investment committee approves the acquisition thesis, purchase price and the management assumptions supporting the deal. Raising doubts about the incumbent CEO shortly afterward may feel like reopening a previously approved decision, the Russell Reynolds authors argue.

Yet a sound initial judgment and a sound decision under new conditions are different questions. Waiting for further quarters can be appropriate evidence gathering or a costly delay, depending on the facts. Group-level historical averages cannot identify which specific investors delayed action.

Different phases require different leadership capabilities

Post-acquisition priorities may include liquidity, integration and cost discipline. Expansion can require new markets, M&A and sales systems. Technological transformation may emphasize capital allocation and new products, while exit preparation brings buyer due diligence and the equity story to the foreground.

These phases are examples, not a universal sequence or a mandate to replace the chief executive repeatedly. Boards can distribute expertise through the CFO, COO, business-unit leaders and independent directors and reassess whether the current leadership configuration meets the next mission.

The 18–24-month exit window narrows the range of options

Russell Reynolds reports that interviewed investors typically begin formal exit preparation about 18 to 24 months before the target sale date. At that point prospective buyers are evaluating the continuity and credibility of the management team alongside financial and commercial results.

Discovering a serious succession gap only close to the sale may leave insufficient time for internal development, outside assessment or stabilization after appointment. Replacement near exit can still be necessary; the point is to examine keep, strengthen and replace options before timing takes choices off the table.

Executive search starts with defining the problem, not collecting names

A board should first determine whether weak performance is driven by the CEO, missing C-suite capability, organizational design, governance or the market. If adding a CFO or COO can close the gap, appointing a new CEO may be unnecessarily disruptive.

Where replacement is required, the relevant evidence is a candidate's real decision responsibilities, outcomes on similar missions, ability to operate at this scale and capital structure, and practical availability. These are decision criteria proposed by Banseog, not proven gains from using any particular search firm.

The lesson is succession optionality, not a deterministic turnover rule

Across 196 completed European exits, CEO turnover and holding periods varied together. Neither the direction of causation nor the counterfactual return for the same company is known. Longer ownership itself raises the opportunity for additional CEO changes.

The more useful question is whether boards repeatedly test leadership against the next phase, have realistic routes to strengthen the team and maintain succession alternatives before a crisis makes them impractical. Protecting the ability to choose may matter more than minimizing the raw number of CEO changes.

BANSEOG VIEW

BANSEOG VIEW | The costly CEO change may be the one made after options disappear

An 8.5-year mean holding period for businesses with two CEO changes does not demonstrate that two changes caused extra years of ownership. Long-held assets have more time for transitions and may face harder underlying problems.

Boards should separate two questions: is the incumbent delivering now, and can the leadership team execute the next value-creation phase? Sometimes stronger finance or operations leadership and a credible chair close a gap without replacing the CEO.

Succession strategy means preserving practical options to retain, strengthen or replace leadership before the exit window narrows. Quantitative performance gains from any particular intervention remain unproven by these observed comparisons.

SOURCES

Primary sources and references

Written Oct 28, 2026. The Oct 23 Russell Reynolds study combines 250+ EMEA appointments, 15 interviews and a separate Aug 26 analysis of 196 completed European PE exits. Exact 5.5/5.8/8.5/9.2/11.0-year means and 4.4/7.7-year timing contrast are observational, not causal. 135 of 196 had a CEO transition. Duration exposure, selection on completed exits and investment difficulty complicate interpretation. The fewer-than-25% succession-plan estimate is one interviewed talent partner's view, not an industry census. Exit preparations at 18–24 months reflect interview respondents. Banseog's decision rules are analytical suggestions, not proven return improvements.