I am Sage Rat’s dad, and was a CEO of a public company for eight years (1,000 employees)…
Because you used the word “CEO” I am assuming you are speaking of a fairly large company. My answer does not apply to small businesses, where anything can happen.
As someone mentioned, the CEO is chosen by the board of directors. Generally, CEOs are only chosen when there is some sort of corporate event. The prior CEO is being ousted, the prior CEO is being “kicked upstairs” (moved aside), the CEO has died, etc. Sometimes, it is because a company has outgrown the founder’s skills, and a seasoned veteran is being brought in. Sometimes the CEO is retiring (which rarely happens unless there is a reason).
It does happen that young, inexperienced executives are appointed CEO, but this is rare. My guess is that it would most likely occur when the CEO is being tossed for some reason, cash is tight, and there is a VP level candidate who has done an outstanding job, and “presents well”. In this situation, the board would “take a chance.”
As to the board recruiting a CEO among recent MBA graduates, I can’t imagine a scenario in which this would happen. Maybe… if it were a venture capital backed startup, and there were a Harvard MBA, or Stanford MBA, who was somehow known to the Venture Capitalists.
It’s really not an issue of age, but of experience. There are a lot of different skills needed to be a CEO of a company; people skills, management skills, fund raising skills, presentation skills, accounting skills, marketing skills, etc. There certainly could be some untested individual who has these skills, but without experience to point at, how is the board to know. Doing well on an interview does not neccesarily mean you are equipped to guide a company. The best indicator of future results is past results.
PS Sage Rat raises another reason I hadn’t thought about. It is certainly possible that the CEO would groom a replacement for himself who might not otherwise be a candidate. For instance, let’s say someone were president of a division of a large corporation (divisional presidents are not usually called CEOs). I could envision this person grooming someone to succeed them should they get promoted, then recommending the person for their job. Anyone watched “The Office” … it’s not as far off how the real world works as you might think.