{"id":4450,"date":"2025-12-17T11:48:04","date_gmt":"2025-12-17T11:48:04","guid":{"rendered":"https:\/\/microvibenews.com\/?p=4450"},"modified":"2025-12-17T11:48:04","modified_gmt":"2025-12-17T11:48:04","slug":"down-arrow-button-icon-13","status":"publish","type":"post","link":"https:\/\/microvibenews.com\/?p=4450","title":{"rendered":"Down Arrow Button Icon"},"content":{"rendered":"

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Good morning. <\/strong>Big companies announcing new CEOs lately are mostly choosing insiders. Think of Walmart\u2019s John Furner, Target\u2019s Michael Fiddelke, and Geico\u2019s Nancy Pierce. But 2025 has actually been a big year for outsider CEOs. With AI roaring ahead plus unprecedented tariffs, historic geopolitics, and rampaging activist investors, boards of directors naturally want someone who can change a company\u2019s direction, and often an outsider, untethered to the company\u2019s past, seems like the right choice. Through September, 33% of the new CEOs in the S&P 500 this year were outsiders, a striking increase from 18% last year, according to the Conference Board. Insider CEOs often seem like the obvious choice, but Jim Citrin, who leads the CEO practice and co-leads the board practice at the Spencer Stuart advisory firm, tells me that research supports boards taking a chance on an outsider\u2014in this or any other business climate.\u00a0\u00a0<\/p>\n

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When it\u2019s time to replace the CEO, boards tend to choose insiders, on the assumption that they outperform outsiders. \u201cThat\u2019s an absolute belief,\u201d Citrin says, based on 25 years of counselling boards on successions. But \u201cit\u2019s not true. The data shows that insiders and outsiders perform virtually the same on an average basis of total shareholder return relative to the market.\u201d Spencer Stuart research of 950 CEOs at S&P 500 companies shows that 34% of insiders are classified as overperformers while 33% of outsiders are. The difference is the volatility of performance. With outsiders \u201cthere\u2019s more upside, but there\u2019s more downside,\u201d Citrin says, meaning the good performers tend to be really good and the poor performers tend to be really poor.<\/p>\n

A related belief held by most of the thousands of directors Citrin has counselled is that seasoned CEOs perform better than neophyte CEOs. Wrong again\u2014it\u2019s just the opposite: \u201cThe data is incredibly strong that first-time CEOs outperform experienced CEOs.\u201d Specifically, Spencer Stuart research has found that when a CEO ran two successive companies, 70% of them performed better on the first. The one exception, Citrin says, is \u201cwhen it\u2019s a clear turnaround and you have someone who is credible in that market and ideally has a playbook.\u201d Think of Lip-Bu Tan at Intel.<\/p>\n

One of directors\u2019 most strongly held views is that insider CEOs bring more stability. It seems so obvious. Citrin says the data isn\u2019t in yet, but he\u2019s skeptical. An insider CEO will typically have been one of two or three candidates, and those who didn\u2019t get the job typically leave, he says. Plus, an insider knows where the bodies are buried and wants to build their own team. So it could be that, on average,\u00a0 insiders \u201cmake more change in the C-suite than someone coming in from the outside.\u201d<\/p>\n

Citrin says he tells directors about all these findings, but \u201cthat doesn\u2019t mean you should do anything. All it means is\u2014and I say this to boards all the time\u2014just be a little more open-minded to what is right for your context at this moment.\u201d<\/p>\n

Contact CEO Daily via Diane Brady at diane.brady@fortune.com<\/em><\/p>\n

Top news<\/h3>\n

Rebuffing Paramount\u2019s deal<\/b><\/p>\n

Warner Bros. Discovery is <\/span>reportedly set to tell shareholders to reject Paramount\u2019s bid<\/span>, leaving Netflix in the pole position and forcing Paramount CEO David Ellison to consider sweetening his offer for the news and entertainment company. Affinity Partners, the fund tied to Jared Kushner, President Donald Trump\u2019s son-in-law, <\/span>has pulled out of Paramount’s bid<\/span>.<\/span><\/p>\n

Inside OpenAI\u2019s \u2018Code Red\u2019<\/b><\/p>\n

Fortune<\/em> has the inside story of the \u2018code red\u2019 that OpenAI CEO Sam Altman called earlier this month to rally his troops amid fiercer AI competition. The company is not in a life-threatening crisis, but \u201cthe code red alert reveals a real concern within OpenAI that the $500 billion company could lose its position as the standard-bearer and pacesetter for generative AI technology,\u201d Fortune<\/em> reports.<\/span><\/p>\n

Amazon\u2019s OpenAI investment<\/b><\/p>\n

Meanwhile, OpenAI is in talks with Amazon about an investment worth more than $10 billion and a deal to use Amazon\u2019s AI chips. <\/span>The report<\/span> comes after OpenAI loosened its relationship with Microsoft this fall, opening the door to raise money and partner with other companies.<\/span><\/p>\n

A SpaceX IPO could bring headaches<\/b><\/p>\n

Elon Musk\u2019s SpaceX <\/span>is reportedly considering an IPO<\/span> that would give it a potential market cap of $1.5 trillion. Exposing the company to public speculation and additional regulations could bring a long list of issues for the already-busy founder.\u00a0<\/span><\/p>\n

Tracking Big Tech stock gains<\/b><\/p>\n

Big tech stocks like Microsoft, Apple, and Meta are <\/span>lagging<\/span> slightly behind the S&P 500 so far this year, and Amazon falls far short with just a 3% gain. Google parent Alphabet, on the other hand, is up around 68%, and investors think its success in AI means more gains are on the way.\u00a0\u00a0<\/span><\/p>\n

PwC\u2019s Gen Z \u2018resilience training\u2019<\/b><\/p>\n

PwC in the U.K. is offering its <\/span>Gen Z employees training to improve their resilience<\/span> in the workplace. They\u2019re being taught how to handle day-to-day work dynamics\u2014especially pressure, criticism, or sticky situations, all of which are common in deal-making scenarios. Phillippa O\u2019Connor, chief people officer at PwC U.K., says some Gen Z workers haven\u2019t developed such muscles because of pandemic disruptions.<\/span><\/p>\n

The markets<\/h3>\n

S&P 500 futures<\/b> are up 0.36% this morning. The last session closed down 0.24%. <\/span>STOXX Europe 600<\/b> was up 0.42% in early trading. The U.K.\u2019s <\/span>FTSE 100<\/b> was up 1.69% in early trading. Japan\u2019s <\/span>Nikkei 225 <\/b>was up. 0.26%. China\u2019s <\/span>CSI 300<\/b> was up 1.83%. The South Korea<\/span> KOSPI<\/b> was up 1.43%. India\u2019s <\/span>NIFTY 50<\/b> was down 0.16%. <\/span>Bitcoin<\/b> was steady at $87K.<\/span><\/p>\n

Around the watercooler<\/h3>\n

Satya Nadella called IQ without emotional intelligence a \u2018waste.\u2019 Research shows being vulnerable at work can even help CEOs win investor trust<\/span> by Sasha Rogelberg<\/span><\/p>\n

OpenAI releases new image model as it races to outpace Google\u2019s Nano Banana amid company code red<\/span> by Sharon Goldman<\/span><\/p>\n

As Americans continue to feel the pain from tariffs and inflation, Lidl launches holiday meal deal for less than $4 per person<\/span> by Nino Paoli<\/span><\/p>\n

Reese Witherspoon says, \u2018I don\u2019t think my career would be possible\u2019 in the age of AI and social media: \u2018It\u2019s a different world\u2019<\/span> by Sydney Lake<\/span><\/p>\n

CEO Daily is compiled and edited by Joey Abrams, Claire Zillman and Lee Clifford.<\/p>\n<\/div>\n

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