Yesterday, Glassdoor.com released its “CEO Watch List,” which ranks CEOs by employee approval ratings. The blog post doesn’t explicitly state its methodology but it appears they create the list from extensive employee surveys.
Although I’m not sure what conclusions can be drawn from this statement, only one of the companies on the list is backed by a private equity firm. One more is a public company with a PE minority stake, another is a recent exit, and a handful of others may have private equity fingerprints in their histories (but not that I found).
The CEO of Sports Authority, the athletic gear retail chain owned by Leonard Green & Co., is the seventh lowest-rated CEO that received 50 or more employee reviews. Doug Morton has a 13% approval rating. Ouch.
Seems Mr. Morton saw the writing on the wall (or surveys, as it may be), because he stepped down from “day-to-day” operations two weeks ago. He’s still the Chairman, and a replacement has yet to be named.
There’s also publicly traded Office Depot, which this year UK buyout firm BC Partners invested in through a PIPE. The firm likely hasn’t had much influence over the company’s CEO, Steve Odland, from the position of minority investor. Odland came in at 7%, though since the report was published, it has increased to 13% (suspicious??).
There’s also Sun Microsystems CEO Jonathan Schwartz, who came in at number 22. The company is in the process of selling to Oracle, and many of the employee complaints revolve around that deal being viewed as a failure, or unnecessary. KKR invested in the debt of Sun Microsystems, presumably on the assumption the company would sell? Jabs at Schwarz necessarily bring up the golden parachute he received from the exit, but none comment on the KKR’s role.
The only other PE-backed CEO which received a low approval rating was Sears Holdings, controlled by Eddie Lampert. Classifying the activist shareholder’s involvement in Sears as private equity is a bit of a stretch though, especially considering the company is still public and Lampert’s firm does not operate as a traditional buyout firm.
So with all the strip-and-flip harping out there, why aren’t more PE-backed CEOs taking the heat? Who knows, but my guess is that publicly traded companies were just easier targets for finding survey-takers. Later I’ll look at the CEOs with the highest approval ratings, though at first glance, it doesn’t seem to include many (or any?) PE-owned companies either. Read more here.