Wrinkles of Change: CEO Succession and the Reproduction of Age Profiles in the Executive Suite

Abstract

We examine the reproduction of age profiles in the executive suite across CEO succession events. Counter to the trend of the general workforce becoming more age diverse, age profiles in the executive suite seem to become more homogenous and CEOs appear to be increasingly older at appointment. This is despite increasing frequency of CEO succession events, which represent opportunities for demographic change of top management to align with changing environments. Drawing on insights from homosocial reproduction theory, upper echelons theory, and executive succession research, we argue that the age profile of executives may be actually reproduced to reduce social uncertainty around CEO succession events, and that over time, age homophily is particularly reinforced under new outsider CEOs. Exploiting CEO turnover as an empirical identification strategy, we construct a unique sample of 391 successions in 297 S&P500 companies between 2000 and 2020 and apply a hierarchical linear modelling specification to test hypotheses. We find support for the overall notion that some age profiles are reproduced across CEO succession events. Notably, the overall age profile shifts upwards as CEOs are increasingly older at appointment, a tendency that is reinforced by outsider CEO successors. We discuss implications for age homophily in executive ranks, how outsider CEOs reinforce demographic similarity, and age-identity of corporate leadership roles.