The Board of Directors of CME Group, the world's leading and most diverse derivatives marketplace, has announced that Craig Donohue, the company's Chief Executive Officer since 2004, has informed them he will step down when his contract expires in December 2012.
As part of the company's succession plan, the Board has appointed Terrence Duffy, who is currently Executive Chairman, to the expanded role of Executive Chairman and President andcurrent President Phupinder Gill to Chief Executive Officer when Donohue's contract expires.
Additionally, the Board extended Duffy's and Gill's contract agreements. Donohue, Duffy and Gill, who have worked together in the Office of the CEO for the last eight years, will work together over the next several months, to effectuate an orderly leadership transition.
Upon implementation of the company succession plan, Duffy will continue to take a hands-on approach in the key external-facing functions of Government Relations, Corporate Marketing and Communications, formalizing oversight of the areas in which he already is significantly involved. Gill, who will report to Duffy, will be responsible for all other aspects of running the company, including Clearing, Technology & Enterprise Computing, Global Operations, Enterprise Solutions, Products & Services, Legal & Market Regulation, Research & Product Development, Finance & Corporate Development, Product Marketing, and Human Resources. The current Management Team also will remain in place.
Duffy and Gill will continue to work together to set the organization's vision and strategic direction, while expanding CME Group's core businesses, developing new growth opportunities, and further strengthening the operations of the company.
'Under Craig's guidance, CME Group has grown into the preeminent global derivatives exchange company', said Duffy. 'He has performed an enormous service to CME as CEO and in numerous other roles over the years as our exchange and the industry have evolved. His many contributions have helped CME transition from a membership-owned organization into a for-profit, public company that has expanded into every major asset class with the acquisitions of the Chicago Board of Trade and the New York Mercantile Exchange and has also extended its reach globally. We thank Craig and wish him well as he moves on to new challenges'.
'Going forward, technology, clearing and operational excellence will continue to be an important facet of how we deliver value to our customers and drive growth for shareholders – all of the areas in which Gill is extremely experienced, making him the right person to serve as our future CEO', said Duffy. 'The Board of Directors and I believe that Gill's decades of experience in all aspects of our business, coupled with his extensive experience in Asia, position him to lead us forward with the successful execution of our global growth strategy', Duffy added.
'I am honored that the Board has placed its confidence in me to step into the role of Chief Executive Officer', said Gill. 'I am thankful for the guidance provided to me by Craig over these past eight years. As a company we are well positioned for the future, and I look forward to working more closely with Terry, the Management Team and the rest of the organization to further expand the influence of our markets and exploit new growth opportunities globally and in the OTC arena. I also look forward to being able to help guide the development of our already strong employee base who will ensure CME Group continues to meet the challenges ahead'.
'After 23 years at CME Group, including eight years as CEO, this is a bittersweet decision for me but I am ready to explore new challenges', said Donohue. 'Working with Terry, Gill and our world-class Management Team, we have transformed our company, accomplished impressive growth, and created substantial value for our shareholders. Our accomplishments as a team include more than $20 billion in acquisitions, $1 billion in strategic global investments and successful extensions into OTC clearing, index services, and technology and co-location services. During my term as CEO, we also achieved average annual revenue growth of 26 percent, average annual net income growth of 32 percent, average annual earnings per share and free cash flow per share growth of 21 percent, total average annual shareholder returns of 20 percent, and an increase in market capitalization of 662% since 2004. I thank our Board, Terry, Gill, our management and employees for their many contributions to these achievements and wish them well as they work together to further advance CME Group'.