Many organizations are concerned with the hiring, promotion, and retention of minority employees. As such, it is crucial to understand the factors that lead to turnover within minority groups and to determine if anything can be done to prevent it. This article explores the risk of turnover among minority CEOs and demonstrates the differences between minority groups regarding their propensity to leave their positions.
MINORITY CEO TURNOVER
In a single study, the authors (Ursel et al., 2023) examined CEO successions from 1993 to 2017 on a month-to-month basis. CEOs were tracked from the time they took the position to the time they left. Results revealed that, on average, ethnic minority CEOs are more likely to stay within their position for a longer period of time and to have a lower risk of turnover than majority group members. However, when looking at minority groups individually, the researchers found that Black CEOs had tenures similar to those of White CEOs. Thus, the authors show that minorities are generally less at risk of turnover than White CEOs, however, there are important differences within each demographic group.
To start, organizations could benefit greatly from the hiring of minority CEOs because they pose less of a flight risk than White CEOs. This could save time and resources on hiring, along with providing increased organizational stability.
Furthermore, this research demonstrates that ethnic minority groups should be viewed separately and not as a whole. The authors discuss how important differences can be overlooked if we do not disaggregate minority group data from one another.
In all, we see that by hiring minority executives, organizations will see higher retention rates, thereby lowering the costs it takes to hire new executives. Additionally, we see the importance of treating minority groups differently so that we can cater to their individual needs.
Ursel, N., Durante, A., & Elsaid, E. (2023). Ethnic minority CEO turnover: Resource‐based and Leadership Categorization Perspectives. Journal of Organizational Behavior, 44(4), 682–699.
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