Wall Street titan Leon Black stepping down as Apollo's CEO

Leon Black is stepping down as CEO of investment giant Apollo Global Management, following the conclusion of an independent investigation into his interactions with Jeffrey Epstein.

Why it matters: Black has long been one of Wall Street's top power brokers, and he's one of the people responsible for helping to create the modern private equity industry.

• Black will "retire" as CEO on July 31, but he'll continue to chair Apollo's board of directors.
• His successor as CEO will be fellow Apollo co-founder Marc Rowan. There had been talk that the firm's third co-founder, Josh Harris, was angling for the job.
• Apollo also is adding four new independent directors, two of whom were named today (Pamela Joyner and Siddhartha Mukherjee) and two yet to be identified.

The backstory: Black has been under pressure for more than a year because of his personal and philanthropic relationship with Epstein that continued even after the late investment adviser pleaded guilty to felony prostitution with an underage girl.

• Apollo had retained law firm Dechert to investigate the matter, and the law firm concluded that there was no business relationship between the firm and Epstein.
• Dechert's full report is available here.
• Black, who paid out $158 million to Epstein and affiliated philanthropies, has never been charged with any criminal conduct.

Below is Leon Black's full statement:

“After a three-month investigation, which included reviewing more than 60,000 documents and interviewing more than 20 individuals, the Dechert report on behalf of the Apollo Board Conflicts Committee confirms the key facts I have previously disclosed concerning my relationship with Jeffrey Epstein, including that I was completely unaware of Mr. Epstein’s abhorrent misconduct that came to light in late 2018, that I did not engage in any wrongdoing or inappropriate conduct, that all fees paid to Mr. Epstein were for legitimate professional advisory services, vetted by respected professional advisors, for significant value received, and that Apollo never did any business with Mr. Epstein. It is important for me to stress again how deeply I regret having had any involvement with Mr. Epstein and I thank the Committee and its counsel for their tireless work over the last few months.

I am extraordinarily proud of what my partners and I have built at Apollo over the past 30 years. As I have advised Apollo’s Board and our investors, and consistent with best-in-class governance, I have decided, as I approach my 70th birthday this July, to begin a process to effectuate my retirement as CEO of Apollo on or before that date and to remain Chairman of the firm. In that role, I look forward to focusing on strategic planning, growth initiatives, investment opportunities and supporting Apollo, which has been my life’s work, in whatever ways I can. This is a decision I have been considering for several years. With Marc Rowan’s welcomed decision to return to Apollo full-time and the firm’s increasing focus on its yield and insurance platforms, I believe that Marc should succeed me as CEO of Apollo when I step down – and the Executive Committee, with the support of the Board, unanimously agrees. Josh Harris will continue to work with our global limited partners and investor base, as a director, member of the Executive Committee, and co-founder.

Importantly, my family and I have long been engaged in philanthropy, focusing especially on medical research, arts and culture, and causes in support of the health, welfare and vitality of New York City. At this stage of my career, I look forward to spending greater time and energy with my family developing impactful philanthropic initiatives. Having reflected at great length on my professional relationship with Mr. Epstein, a relationship that I profoundly regret, and having discussed the matter with my family, I have also decided that one way I can begin to address the grievous error of having maintained a professional relationship with Mr. Epstein is to pledge $200 million towards initiatives that seek to achieve gender equality and protect and empower women, including supporting maternal health, women in finance and the arts, in the classroom, in laboratories and in the field of entrepreneurship, as well as helping survivors of domestic violence, sexual assault and human trafficking. My family and I intend to work with experts in these areas to develop a philanthropic plan that I hope will have a positive and enduring impact.”