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Board Leadership Structure and CEO Turnover

30 Pages Posted: 14 Jun 2000 Last revised: 29 Jul 2014

Vidhan K. Goyal

Hong Kong University of Science & Technology (HKUST) - Department of Finance

Chul W. Park

The University of Hong Kong - School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: July 1, 2001

Abstract

We study whether bestowing CEO and chairman duties on one individual affects a board's decision to dismiss an ineffective CEO. The results show that the sensitivity of CEO turnover to firm performance is significantly lower when the CEO and chairman responsibilities are vested in the same individual. These results are consistent with the view that the lack of independent leadership in firms that combine the CEO and chairman positions makes it difficult for the board to remove poorly performing managers.

Keywords: Corporate governance; Leadership structure; CEO duties; CEO turnover; sensitivity to firm performance

JEL Classification: G34, D23

Suggested Citation

Goyal, Vidhan K. and Park, Chul W., Board Leadership Structure and CEO Turnover (July 1, 2001). Journal of Corporate Finance, Vol. 8, No. 1, 2002. Available at SSRN: https://ssrn.com/abstract=224055 or http://dx.doi.org/10.2139/ssrn.224055

Vidhan K. Goyal (Contact Author)

Hong Kong University of Science & Technology (HKUST) - Department of Finance ( email )

Clear Water Bay, Kowloon
Hong Kong
852-2358-7678 (Phone)
852-2358-1749 (Fax)

HOME PAGE: http://www.vidhangoyal.com

Chul Won Park

The University of Hong Kong - School of Business ( email )

Meng Wah Complex
Pokfulam Road
Hong Kong
China
+852-2859-1081 (Phone)

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