55 Pages Posted: 1 Mar 2011 Last revised: 18 Jul 2012
Date Written: July 16, 2012
We use data on the employment histories of CEOs to examine the relation between the CEO’s labor-market mobility and the CEO-firm match. Mobile CEOs match with firms that exhibit poor performance, face revenue shocks, and offer risk-sensitive compensation. At these firms, mobile CEOs increase shareholder value, improve operating performance, increase performance volatility, increase idiosyncratic equity risk, and alter asset structure. Our results suggest that mobile CEOs are fundamentally different from stationary CEOs and that the board recognizes these differences ex ante. The firm’s needs and the CEO’s attributes influence the CEO-firm match, and this match influences firm value and strategy.
Keywords: CEO Experience, CEO-firm Match, Firm Performance, Firm Policies, Employment History
JEL Classification: G30, G32, G34, J6
Suggested Citation: Suggested Citation
Ryan, Harley E. and Wang, Lingling, CEO Mobility and the CEO-Firm Match: Evidence from CEO Employment History (July 16, 2012). Available at SSRN: https://ssrn.com/abstract=1772873 or http://dx.doi.org/10.2139/ssrn.1772873
By Yihui Pan