Executive Turnover and Outside Directors on Two-Tiered Boards
Managerial and Decision Economics, Volume 36, Issue 3, pp. 158–176
Posted: 17 Aug 2016 Last revised: 20 Apr 2020
Date Written: April 2015
This paper examines the determinants of executive turnover on two-tiered boards, emphasizing the monitoring role of supervisory board members with simultaneous outside directorships. Based on a unique sample of executives from large German firms, we find that outside supervisory board members generally increase executive turnover at the firms they monitor. This influence is especially pronounced when outside supervisory board members are simultaneously active as managers themselves and capital control is rather weak. These results suggest that external managers on supervisory boards enhance the monitoring intensity and substitute for weak capital control in the absence of large shareholders.
Keywords: Corporate Governance, Executive Turnover, Outside Directors, Shareholder Control
JEL Classification: J53, K22, K31, L22
Suggested Citation: Suggested Citation