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Corporations Turn to Older Executives
When Marion O. Sandler, 71, and her husband Herbert acquired the Golden West Financial Corporation in Oakland in 1963, where she serves as chief executive, most women wore hats and gloves to their low-level administrative positions in the office. And when Robert J. McLaughlin, a top executive at the Imperial Sugar Company, was born in December 1932 at the nadir of the Great Depression, a third of the workforce was idle. "I remember the food rationing," he said. "We couldn't get meat. We had to get coupons to buy gas." Old folks all, and maybe the future face of American business. For more than 15 years, the chief executives of America were getting younger and younger. Now, that trend has ended. And, some corporate-governance experts say, it will soon be reversed. In 1980, half of the C.E.O.'s of Fortune 100 companies were over 60, according to an annual study by recruiting firm Spencer Stuart and Chief Executive magazine. That number dropped steadily until 1997, when just a quarter of chief executives of the nation's 100 largest companies were older than 60. Since then, that figure has hovered around 25 percent, where it was last year. And demographers believe the numbers of older executives will continue to creep up until the millions of baby boomers born between 1946 and 1964 retire, which may be later than most people think. "The average life expectancy is increasing every year, and people are asking themselves, `Do I have enough money to retire now?' " said Robert K. Critchley, an executive at the human-resources firm Drake Beam Morin and the author of "Rehired, Rewired or Retired?" (Jossey-Bass, 2002). In fact, demographers say, the same baby-boomer dynamic that drove the average age down for so long is likely to drive it back up. In 1980, the oldest of the Americans born in the years following World War II were just turning 35 and beginning to penetrate the ranks of upper management; now, they are turning 57. "We're talking about a lot of people moving into their 50's and 60's," said William Frey, a census data specialist and a senior fellow at the Milken Institute, an economic research group in Santa Monica, Calif. "That's going to mean further aging of the work force, particularly among upper white-collar workers." Executive recruiters say that not only are there more older executives to choose from right now, but they are in greater demand. At the height of the Internet boom, youth was in. Now, as corporate America struggles with a weak economy and spreading accounting scandals, experience matters more, and directors are practically begging people with good records and reputations to stay in leadership positions. "You see three reasons that boards turn to older executives," said John Thompson, vice chairman of executive recruiting at Heidrick & Struggles, the big recruiting firm. "Financial or legal difficulties, or situations where succession plans have not worked out." At TXU, a utility giant in Dallas, it was the sudden retirement of the president that prompted the board to ask Mr. Nye to renew his contract in May. It allows him to remain in office as late as 2006. "Today, credibility is important, and people who have been around a while ・we're just a known quantity," said Mr. Nye, who recently marked his 42nd year at the corporation. An increasing number of big companies, among them Honeywell International, Corning Inc. and Symbol Technologies, are also luring their retired C.E.O.'s back to help set things right. Why do they do it? Well, you can only play so much golf. Indeed, in the spring of 2001, the board of the Imperial Sugar Company, the country's largest sugar maker, reached Mr. McLaughlin, 69, on the golf course with an invitation to join its board as it prepared to emerge from bankruptcy. He agreed, and a few months later, it asked him to serve as temporary C.E.O. to deal with Imperial's 25 creditors, sell off assets and find a permanent replacement. Though the job would require 12-hour days and travel on Sundays, Mr. McLaughlin, who started his career at PPG Industries in 1957 and has turned around two other companies, decided to give it a try. "I like dealing with the unknown," he said. By last April, Mr. McLaughlin had helped install a new C.E.O. and had been named chairman. Meantime, his services remain in demand; calls come about every other week from lawyers or lenders representing other troubled companies in need of a seasoned turnaround specialist. To be sure, negative stereotypes about older executives persist. Mr. Critchley, the author, named some: They resist technology; they are suspicious of change; they want to be rewarded more for loyalty than performance. None of which is true, says Ms. Sandler, the 71-year-old who runs Golden West Financial and who is believed to be the longest-running female chief executive of a major corporation in America. "I use a cellphone, and a laptop at home, and I like to spend time on the Net looking at other companies' Web sites," she said. Better yet, the years have brought a wisdom younger executives have a hard time learning: There is more to life than your job. One of Ms. Sandler's rules is never to discuss business with her husband, the co-C.E.O., after 10 p.m. When he tries to break that rule, she says, "I tell him, it's not my time of day." FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Action on Aging distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
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ack
when Erle Nye, the 65-year-old chief executive of the TXU
Corporation, started his career, plastic was the new lightweight
component of cars, not a credit card; cells were the building blocks of
the body, not portable phones, and PC meant past commander, not personal
computer or politically correct.