CEO founder status and firm financial performance

Founders create their organizations, yet are often expected to eventually become liabilities to these same organizations. Past empirical research on the relationship between CEO founder status (i.e., is the CEO also the founder?) and firm performance has yielded inconsistent results. This study of 94 founder‐ and nonfounder‐managed firms finds that founder management has no main effect on stock returns over a 3‐year holding period, but that firm size and firm age moderate the CEO founder status–firm performance relationship. Copyright © 2000 John Wiley & Sons, Ltd.     

Stakeholder management as a predictor of CEO compensation: main effects and interactions with financial performance

We test the effects of stakeholder management on CEOs' salaries, bonuses, stock options, and total compensation. We also examine the extent to which the interaction of stakeholder management and financial performance determines compensation. Using a longitudinal database of 406 Fortune 1000 firms, our results suggest that stakeholder management is relevant to boards of directors when setting CEO compensation. Specifically, we found a significant, negative main effect of stakeholder management on CEO salaries. Further, we found that stakeholder management typically reduces the rewards CEOs may get for increasing levels of financial performance. In tandem, these results indicate that CEOs may jeopardize their personal wealth by pursuing stakeholder‐related initiatives. Copyright © 2005 John Wiley & Sons, Ltd.     

Performance consequences of new CEO ‘Outsiderness’: Moderating effects of pre‐ and post‐succession contexts

This study seeks to reconcile inconsistent findings on the performance consequences of new CEO origin. Drawing on five decades of empirical research on CEO succession outcomes, I develop a more refined theoretical conceptualization and a finer‐grained measurement of the underlying construct of the insider vs. outsider CEO, and build and test a more comprehensive and nuanced framework of the succession context. A longitudinal investigation of the U.S. airline and chemical industries (1972–2002) indicates that new CEO ‘Outsiderness’, conceptualized as a continuum raging from new CEOs who have a greater combination of firm and industry tenure to those who have no experience in the firm and the industry, has no main effect on post‐succession firm performance. However, significant moderating effects are found when environmental munificence, pre‐succession firm performance, and concomitant strategic and senior executive team changes are considered. Together, these findings highlight the need to consider both pre‐ and post‐succession contextual factors for evaluating the performance effects of new CEO outsiderness. Copyright © 2007 John Wiley & Sons, Ltd.     

CEO Dismissal: The role of investment analysts

While poor firm performance has been shown to be a predictor of CEO dismissal, little is known about the role of external constituents on the board's decision to dismiss the firm's CEO. In this study, we propose that investment analysts, as legitimate third‐party evaluators of the firm and its leadership, provide certification as to the CEO's ability, or lack thereof, and thus help reduce the ambiguity associated with the board's evaluation of the CEO's efficacy. In addition, the board tends to respond to investment analysts because their stock recommendations influence investors, whom the board wants to appease. Using panel data on the S&P 500 companies for the 2000–2005 period, we find that negative analyst recommendations result in a higher probability of CEO dismissal. Copyright © 2011 John Wiley & Sons, Ltd.     

Interpartner Fit and Its Performance Implications: A Four-Case Study of U.S.-China Joint Ventures

In previous research on international joint ventures, a commonly accepted conceptualization and operationalization of interpartner fit is lacking. As a result, empirical studies have either failed to confirm theoretical predictions or produced inconsistent findings that are difficult to reconcile. Using a multiple-case method, this study developed a model in which interpartner fit is conceptualized as a multidimensional construct consisting of the compatibility between the partners strategic objectives, contribution and joint management of critical resources, consensus on the venture's operating culture and strategy, and structure of relative bargaining power and control over the venture's operation. The longitudinal case studies demonstrated the relationship between interpartner fit and joint venture performance and also revealed the rich dynamics and changes in interpartner fit'misfit over time.     

The effect of CEO pay deviations on CEO withdrawal,firm size,and firm profits

We build upon previous work on the effects of deviations in CEO pay from labor markets to assess how overcompensation or undercompensation affects subsequent voluntary CEO withdrawal, firm size, and firm profitability, taking into account the moderating effect of firm ownership structure. We find that CEO underpayment is related to changes in firm size and CEO withdrawal, and that the relationship between CEO underpayment and CEO withdrawal is stronger in owner‐controlled firms. We also show that when CEOs are overpaid, there is higher firm profitability; a relationship that is weaker among manager‐controlled firms. We then discuss the implications that these findings have for future research. Copyright © 2010 John Wiley & Sons, Ltd.     

CEO tenure and organizational performance: an intervening model

While CEO job tenure is seen as influencing firm performance, the intervening mechanisms that govern this influence have remained largely unexplored. Given that individuals in the firm most closely influenced by the CEO are members of the top management team (TMT), we focus on the CEO‐TMT interface as one important intervening mechanism. Specifically, our tested model suggests that CEO tenure indirectly influences performance through its direct influences on TMT risk‐taking propensity and the firm's pursuit of entrepreneurial initiatives. Results from structural equation modeling are consistent with this model and support its associated hypotheses. In the discussion, we trace the implications of our study for research and practice. Copyright © 2007 John Wiley & Sons, Ltd.     

Difference in degrees: CEO characteristics and firm environmental disclosure

We contribute to the literature on firms' responses to institutional pressures and environmental information disclosure. We hypothesize that CEO characteristics such as education and tenure will influence firms' likelihood to voluntarily disclose environmental information. We test our hypotheses by examining firms' responses to the Carbon Disclosure Project (CDP) and find that firms led by newly appointed CEOs and CEOs with MBA degrees are more likely to respond to the CDP, while those led by lawyers are less likely to respond. Our results have implications for research on strategic responses to institutional pressures and corporate environmental performance. Copyright © 2013 John Wiley & Sons, Ltd.     

FORM OF CONTROL: A CRITICAL DETERMINANT OF ACQUISITION PERFORMANCE AND CEO REWARDS

Based on two research streams, we investigate whether acquiring firms’ form of control might be associated differently with CEO rewards or excess returns. We theoretically reason that in manager-controlled corporations acquisitions may be detrimental to the interests of shareholders and CEO rewards might be based on nonperformance criteria. In owner-manager-controlled and owner-controlled firms acquisitions may benefit the stockholders. While CEO rewards of owner-controlled firms may be based on performance criteria, however, executive rewards of owner-manager-controlled firms may be based on both performance and nonperformance factors. The findings indicate that for manager-controlled firms acquisition announcements result in negative excess returns to shareholders. For owner-controlled and owner-manager-controlled firms such announcements result in positive excess returns. The findings also suggest that increases in corporate size due to acquisitions are significantly and positively associated with CEO rewards of manager-controlled and owner-manager-controlled firms. For owner-controlled firms, excess returns are significantly and positively associated with CEO rewards. © 1997 by John Wiley & Sons, Ltd.     

Higher Highs and Lower Lows: The Role of Corporate Social Responsibility in CEO Dismissal

Research summary: Investing a firm's resources in corporate social responsibility (CSR) initiatives remains a contentious issue. While research suggests firm financial performance is the primary driver of CEO dismissal, we propose that CSR will provide important additional context when interpreting a firm's financial performance. Consistent with this prediction, our results suggest that past CSR decisions amplify the negative relationship between financial performance and CEO dismissal. Specifically, we find that greater prior investments in CSR appear to expose CEOs of firms with poor financial performance to a greater risk of dismissal. In contrast, greater past investments in CSR appear to help shield CEOs of firms with good financial performance from dismissal. These findings provide novel insight into how CEOs' career outcomes may be affected by earlier CSR decisions. Managerial summary: In this study, we examined a potential personal consequence for CEOs related to corporate social responsibility (CSR). We explored the role prior investments in CSR play when a board evaluates the firm's financial performance and considers whether or not to fire the CEO. Our results suggest that while financial performance sets the overall tone of a CEO's evaluation, CSR amplifies that baseline evaluation. Specifically, our results suggest that greater past investments in CSR appear to (a) greatly increase the likelihood of CEO dismissal when financial performance is poor, and (b) somewhat reduce the likelihood of CEO dismissal when financial performance is good. Thus, striving to deliver profits in a socially responsible manner may have both positive and negative personal consequences. Copyright © 2017 John Wiley & Sons, Ltd.     

The strategic value of CEO external directorate networks: implications for CEO compensation

This study examines the relationship between CEO external directorate networks and CEO compensation. Drawing on previous research showing a link between executives' external networks, firm strategy, and performance, the study argues that executive external networks are strategically valuable to firms; thus, they should be reflected in executive compensation. The study further examines whether firm diversification, with its elevated demand for strategic resources, moderates the relationship between CEO external directorate networks and pay. Hypotheses are tested using a sample of 460 Fortune 1000 firms. Analyses reveal that the rewards to CEO external directorate networks are contingent upon the firm's level of diversification. Implications for future research and practice are discussed. Copyright © 2001 John Wiley & Sons, Ltd.     

Performance deviations and acquisition premiums: The impact of CEO celebrity on managerial risk‐taking

Research summary: This article draws on identity control theory and a study of acquisition premiums to explore how CEO celebrity status and financial performance relative to aspirations affect firm risk behavior. The study finds that celebrity CEOs tend to pay smaller premiums for target firms, but these tendencies change when prior firm performance deviates from the industry average returns, thereby leading these CEOs to pay higher premiums. The study also finds that the premiums tend to be even larger when celebrity CEOs have more recently attained celebrity status. Taken together, these findings contribute to identity control theory and CEO celebrity literatures by suggesting that celebrity status is a double‐edged sword and that the internalization of celebrity status by CEOs strongly influences the decision‐making of CEOs. Managerial summary: The purpose of this article is to examine how CEO celebrity status and financial performance relative to aspirations affect the size of acquisition premiums. The study finds that celebrity CEOs tend to pay smaller premiums for target firms. However, when celebrity CEOs' prior firm performance is either better or worse than the industry average, these CEOs pay higher premiums. This situation is exacerbated when the CEO has only recently been crowned a celebrity. In effect, these CEOs feel great pressure to match the inflated performance expectations that come with celebrity status. These findings suggest that being a celebrity is a double‐edged sword. The implication here is that CEOs who have recently been crowned a celebrity should be aware of these pressures and cope accordingly. Copyright © 2015 John Wiley & Sons, Ltd.     

Firm‐specific knowledge assets and employment arrangements: Evidence from CEO compensation design and CEO dismissal

Research summary : We argue that firms with greater specificity in knowledge structure need to both encourage their CEOs to stay so that they make investments with a long‐term perspective, and provide job securities to the CEOs so that they are less concerned about the risk of being dismissed. Accordingly, we found empirical evidence that specificity in firm knowledge assets is positively associated with the use of restricted stocks in CEO compensation design (indicating the effort of CEO retention) and negatively associated with CEO dismissal (indicating the job securities the firm committed to CEOs). Furthermore, firm diversification was found to mitigate the effect of firm‐specific knowledge on both CEO compensation design and CEO dismissal, as CEOs are more removed from the deployment of knowledge resources in diversified firms. Managerial summary : A firm's knowledge structure, that is, the extent to which its knowledge assets are firm‐specific versus general, has implications for both CEO compensation design and CEO dismissal. In particular, we find that a firm with a high level of firm‐specific knowledge has the incentive to retain its CEO through the use of restricted stocks in CEO compensation. Such a firm is also likely to provide job security for its CEO, leading to a lower likelihood of CEO dismissal. These arguments, however, are less likely to hold in diversified corporations as CEOs in such corporations are more removed from the deployment of knowledge assets. A key managerial implication is that CEO compensation and job security design should be made according to the nature of firm knowledge assets. Copyright © 2016 John Wiley & Sons, Ltd.     

The role of CEO relative standing in acquisition behavior and CEO pay

In this study, we develop and test a theory of CEO relative pay standing. Specifically, we propose that CEOs with negative relative pay standing status (underpaid relative to comparison CEOs) will engage in acquisition activity, as a self‐interested means of attempting to realign their pay with that of their peers. We further propose that, when CEOs with negative relative pay standing acquire, they will tend to finance those acquisitions more heavily with stock than cash, to mitigate the risk associated with those deals. Finally, we argue that acquisition activity will partially mediate the influence of CEO negative relative pay standing on subsequent CEO compensation increases; however, that pay growth will come primarily in the form of long‐term incentive pay. Our results support our predictions. Copyright © 2014 John Wiley & Sons, Ltd.     

基于CEO变动调节效应的高管团队特征对企业研发投资及技术创新绩效的影响研究

本文以信息技术业上市公司2011～2014年的数据为样本,运用逐步多元回归分析的方法,通过逐步引入高管团队特征变量、CEO变动变量、CEO变动变量与高管团队特征变量交互项对因变量研发投资及技术创新绩效影响进行了回归分析。结果表明：CEO变动对研发投资和技术创新绩效具有显著的正向相关关系;CEO变动可以部分调节高管团队特征对研发投资和技术创新绩效的影响;高管团队持股与年龄异质性与技术创新绩效显著正相关;两职合一与研发投资显著负相关;任期异质性和教育程度异质性与研发投资显著正相关。