What Happens to CEOs After They Retire? New Evidence on Career Concerns, Horizon Problems, and CEO Incentives
James A. Brickley
Simon Graduate School of Business, University of Rochester
Jeffrey L. Coles
Arizona State University (ASU) - Finance Department
James S. Linck
Southern Methodist University
Simon School of Business Working Paper FR 97-10
This paper provides evidence on a previously unidentified source of managerial incentives: concerns about post-retirement board service. Both the likelihood that a retired CEO serves on his own board two years after departure, as well as the likelihood of serving as an outside director on other boards, are positively and strongly related to his performance while CEO. Retention on the CEO's own board depends primarily on stock returns, while service on outside boards is better explained by accounting returns. The evidence also suggests that firms consider ability in choosing board members.
Number of Pages in PDF File: 48
JEL Classification: G30, G32, J33working papers series
Date posted: June 23, 1998
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