CEO Approval in Social Media and Turnover

48 Pages Posted: 27 Jan 2018 Last revised: 20 May 2018

See all articles by Sea-Jin Chang

Sea-Jin Chang

National University of Singapore (NUS) - Department of Business Policy

Ji Yeol Jimmy Oh

Hanyang University

Kwangwoo Park

KAIST (Korea Advanced Institute of Science and Technology) - College of Business

Date Written: May 11, 2018

Abstract

Using a unique social media dataset that captures the level of employee satisfaction in S&P 1500 firms, this paper explores its relationship with CEO turnover and firm performance. Our results show that firms with lower CEO approval level on average experience poor performance and higher CEO turnover. We do however find that the performance-turnover sensitivity is less pronounced for firms with highly approved CEOs, a view consistent with the manager-worker alliance hypothesis. Our findings highlight the board’s difficulties in replacing poorly-performing CEOs with high popularity among employees. We conclude that employee opinions matter for major internal governance decisions and suggest factors beyond performance as determinants of CEO turnover.

Suggested Citation

Chang, Sea-Jin and Oh, Ji Yeol Jimmy and Park, Kwangwoo, CEO Approval in Social Media and Turnover (May 11, 2018). Asian Finance Association (AsianFA) 2018 Conference. Available at SSRN: https://ssrn.com/abstract=3110233 or http://dx.doi.org/10.2139/ssrn.3110233

Sea-Jin Chang

National University of Singapore (NUS) - Department of Business Policy ( email )

17 Law Link
Singapore 117591
Singapore

Ji Yeol Jimmy Oh

Hanyang University ( email )

School of Business #513
Wangsimni-ro 222, Seongdong-gu
Seoul, Seoul 04763
Korea, Republic of (South Korea)
+82222202689 (Phone)

Kwangwoo Park (Contact Author)

KAIST (Korea Advanced Institute of Science and Technology) - College of Business ( email )

85 Hoegiro
Seoul 02455
Korea, Republic of (South Korea)
82-2-958-3540 (Phone)
82-2-958-3604 (Fax)

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