By Jonathan Katz CEO turnover is rising, and the number of companies that are hiring their top leader from the outside has nearly doubled during the last decade, according to a 1999 proxy analysis conducted by Bethesda, Md.-based Watson Wyatt Worldwide, a global human-capital consulting firm. "There's no question that CEO turnover is rising, and despite the companies' efforts to develop a No. 2 executive internally, there simply aren't enough of them to fill all of the openings," says Ira Kay, North American director of Watson Wyatt's human-capital group. "A growing number of CEOs are being terminated for poor corporate performance, a situation that almost always leads to an external hire. Additionally, successful CEOs are retiring earlier thanks to stock options." The analysis found that out of 800 of the largest U.S. companies surveyed, 20% had hired their CEOs from outside the company within the last five years compared with 11% in 1990.