Top Executive Turnovers: Separating Decision and Control Rights
Managerial and Decision Economics, Vol. 26, No. 1, pp. 25-37, January/February 2005
Posted: 3 Apr 2008
This paper examines the relationship between performance and top executive turnovers using a sample of 81 turnovers and matching companies listed on the Copenhagen Stock Exchange. We find that poor market performance increases the probability of management replacements and that forced layoffs are value-increasing events while voluntary resignations are value-decreasing events. Large shareholders as active monitors, or part of corporate control, are not exhibited in the results. If large shareholders have any influence on CEO turnovers it is not revealed in our data. Indeed, separating control rights from decision rights does not appear to affect managerial turnovers.
Keywords: CEO Turnovers, Corporate Governance, Ownership Structure
JEL Classification: G14. G23, G32
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