Internal Monitoring Mechanisms and CEO Turnover: A Long-Term Perspective

Posted: 23 May 2013 Last revised: 30 May 2013

See all articles by Mark R. Huson

Mark R. Huson

University of Alberta - Department of Finance and Statistical Analysis

Robert Parrino

University of Texas at Austin - Department of Finance

Laura T. Starks

University of Texas at Austin - Department of Finance

Date Written: December 17, 2001

Abstract

We report evidence on chief executive officer (CEO) turnover during the 1971 to 1994 period. We find that the nature of CEO turnover activity has changed over time. The frequencies of forced CEO turnover and outside succession both increased. However, the relation between the likelihood of forced CEO turnover and firm performance did not change significantly from the beginning to the end of the period we examine, despite substantial changes in internal governance mechanisms. The evidence also indicates that changes in the intensity of the takeover market are not associated with changes in the sensitivity of CEO turnover to firm performance.

Suggested Citation

Huson, Mark R. and Parrino, Robert and Starks, Laura T., Internal Monitoring Mechanisms and CEO Turnover: A Long-Term Perspective (December 17, 2001). Journal of Finance, Vol. 56, No. 6, 2001, DOI: 10.1111/0022-1082.00405; University of Alberta School of Business Research Paper No. 2013-209. Available at SSRN: https://ssrn.com/abstract=2268753

Mark R. Huson (Contact Author)

University of Alberta - Department of Finance and Statistical Analysis ( email )

4-20C Business
University of Alberta
Edmonton, Alberta T6G 2R6
Canada
780-492-2803 (Phone)
780-492-3325 (Fax)

Robert Parrino

University of Texas at Austin - Department of Finance ( email )

Red McCombs School of Business
Austin, TX 78712
United States
512-471-5788 (Phone)
512-471-5073 (Fax)

Laura T. Starks

University of Texas at Austin - Department of Finance ( email )

Red McCombs School of Business
Austin, TX 78712
United States
512-471-5899 (Phone)
512-471-5073 (Fax)

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