Leadership Turnover in Russian Companies Reaches Record Levels as Bonuses and Salary Indexation Disappear

In the largest Russian companies, a notable rise in leadership turnover has been recorded, occurring against a backdrop of stagnant salary indexation and cuts in employee bonuses. The Moscow Times reports, referencing analytics from Regroup, that by the end of 2025, 18% of CEOs in the surveyed companies had changed, which is nearly double the global average of approximately 10%.

Since 2022, more than half of the largest companies have already changed their leadership, with 63% of these changes occurring unexpectedly. The average tenure of a CEO now stands at 6.5 years, with 65% of leaders holding their positions for less than five years. These figures indicate a growing instability within the management elite in the country.

The authors of the study note that a unique model of business management is developing in Russia, which significantly differs from the Western approach. A key feature of this model is the emphasis on internal candidates. In 2025, the share of such appointments reached a record 77%, an increase of 22% from the previous year. This trend suggests that companies are increasingly opting for leaders from within, as they possess a better understanding of the business, internal connections, and the specifics of interaction with shareholders. 'The strategy of appointing 'insiders' minimizes errors in critical business processes, which is particularly important in conditions of declining margins and demand,' stated Oksana Morsina, managing partner at Regroup.

However, the turnover of leadership does not lead to a rejuvenation of the management team. On the contrary, the average age of directors has risen to 53-54 years, which is one and a half years older than before. Currently, over 65% of CEOs are over 50 years old, while the share of leaders younger than 40 stands at around 5%. According to Morsina, the Russian market for top managers continues to experience a shortage of senior executives, particularly due to the emigration of some managers abroad and concerns over secondary sanctions.

At the same time, businesses have begun to cancel salary indexation and reduce bonuses for employees, even in the absence of declining financial performance. Companies are shifting to a model of 'tactical austerity,' citing growing economic challenges within the country. As noted by Alexey Chikhachov, managing partner of HR agency A2, businesses have started to convert a significant portion of executives' income into variable components tied to performance. This indicates that companies are trying to adapt to new economic realities.

Earlier reports indicated that Russian oil and gas revenues fell to their lowest levels since the COVID-19 pandemic in 2025. The budget of the Russian Federation may face a significant deficit by early 2026 due to shortfalls in oil and gas revenues, a fact acknowledged by the government of the aggressor country.

Ukrainian intelligence has also stated that the financial condition of medium and large enterprises in Russia continues to deteriorate, showing an increase in imbalances within the corporate sector. More than half of large companies in Russia ended 2025 with declining profits, cut or completely frozen investment projects, and many are preparing to lay off employees.

On February 24, 2026, it became known that around 300 companies in Russia are preparing to close. For the first time in history, 74 Russian regions found themselves in a financial hole, indicating serious problems in the economy. A wave of mass business closures has begun in Russia, and the Russian Ministry of Finance has acknowledged that the deficit in the aggressor's treasury is increasing at a record pace.

According to Rosstat, over 17,000 Russian enterprises reported losses. VkusVill, the first major grocery retailer in Russia, has begun to scale back its retail network, closing 286 stores by the end of 2025. Magnit, the largest retail chain in Russia by the number of stores, also ended 2025 with a net loss. On April 3, 2026, it was reported that 22 Russian industries had gone into significant losses, and the clothing retailer Zolla closed 35 stores amid a sharp decline in profits.