CEO health

Using comprehensive data on 28 cohorts in Sweden, we analyze CEO health and its determinants and outcomes. We find CEOs are in much better health than the population and on par with other high-skill professionals. These results apply in particular to mental health and to CEOs of larger companies. We explore three mechanisms that can account for CEOs’ robust health. First, we find health predicts appointment to a CEO position. Second, the CEO position has no discernible impact on the health of its holder. Third, poor health is associated with greater CEO turnover. Here, both contemporaneous health and health at the time of appointment matter. Poor CEO health also predicts poor firm outcomes. We find a statistically significant association between mental health and corporate performance for smaller-firm CEOs, for whom a one standard deviation deterioration in mental health translates into a performance reduction of 6% relative to the mean.     

Friend or Foe? CEO gender,political ideology,and gender-pay disparities in executive compensation

Do female CEOs reduce gender-pay disparities in top management teams (TMTs)? Some scholars draw on social identity theory to argue that, as individuals tend to identify with and support their in-groups, appointing a female corporate leader (i.e., CEO) will mitigate the gender-pay gap among executives. Yet, others draw on the queen-bee syndrome to postulate that some female CEOs may rather strengthen gender-pay disparities in upper echelons – by favoring out-groups (male) more than their in-groups (female). We bring together these opposing theoretical arguments to develop a ‘beyond CEO gender’ perspective, arguing that the effects of CEO gender on TMT gender-pay disparities should be considered in conjunction with the corporate leaders' values – as reflected by their political ideology. Our research demonstrates that conservative-female CEOs compensate female (versus male) executives lower compared to all other CEO gender-ideology categories (i.e., female-liberal CEOs, male-liberal CEOs, and male-conservative CEOs). Overall, our work contributes to theory on the CEO-TMT interface by highlighting the role of the CEO as the ‘architect’ of executive remuneration.     

The emerging CEO agenda

This article identifies and articulates the major challenges facing CEOs of large multinational firms. Analysis of recent surveys and interviews highlights eight challenges: 1. Developing growth avenues, 2. Raising productivity, 3. Competing for talent, 4. Managing diverse risks, 5. Tightening corporate governance, 6. Incorporating sustainability, 7. Creating new innovation models, and 8. Building out new infrastructures. This large and broad set of issues involves new twists on known challenges and the emergence of new challenges. These challenges are demanding because they require new types of non-business expertise, their rules are not yet clear, and they are interdependent. CEOs need to craft an agenda for dealing individually and collectively with these issues.     

基于中国上市公司的CEO更替与公司治理有效性研究

以中国上市公司为样本,采用2002～2005年的数据,从CEO更替的视角检验了中国公司治理的有效性.实证结果表明:中国的公司治理是有效的,即企业绩效差的CEO更可能被更换,但是这种有效性与正式制度安排的公司治理机制并不相关,这可能是非正式制度的公司治理机制发挥了重要作用.     

A neuroscience-based model of why and when CEO social values affect investments in corporate social responsibility

Why and when do CEOs invest in corporate social responsibility (CSR)? We theorize how CEOs' intrinsic motivations – their social values – and the incentivizing context interact to determine the utility they attach to generating collectively beneficial outcomes in decision-making, subsequently manifested in organizations' CSR investments. Based on a review of neuroscience evidence, indicating that social values are associated with distinct patterns of neural activation, we propose that these values are the compass by which CEOs navigate in complex decision environments. For CEOs with other-regarding values, generating collectively beneficial outcomes is part and parcel of their utility function. They are intrinsically motivated to invest in CSR, regardless of context. In contrast, CEOs with self-regarding values derive utility from generating collective benefits only when it is monetarily or socially incentivized. They are extrinsically motivated to invest in CSR when they stand to gain from it personally.     

Does corporate and country corruption risk affect CEO performance? A study of the best-performing CEOs worldwide

By combining upper echelon theory with meso theory of management, this study investigates the relationship between both corporate and country corruption risk and the performance of CEOs, while controlling for a set of individual-level variables. We used a sample of 455 observations related to 249 listed companies from a list published by the Harvard Business Review of the world's best-performing CEOs, in both developed and emerging countries, over the 5-year period between 2013 and 2017. We implemented hierarchical linear models in a three-level approach based on country- (macro), firm- (meso), and individual-level (micro) variables. We found that corporate corruption risk negatively impacts CEO performance, although this relationship is also significantly moderated by the corruption risk at the country level. Our results support the view that corporate corruption prevention devices play a strong governance role in countries with high corruption risk. By exploring the interplay between these macro- and meso-factors in explaining the micro-level of CEO performance, our paper aims to build a contextualized meso-theory of corruption risk.     

The double-edged sword of CEO/chairperson duality in corporatized state-owned firms: evidence from top management turnover in China

This study examines how board leadership structure (CEO duality) affects the corporate governance of corporatized state-owned firms where the state shareholders use these firms to serve both profit and non-profit objectives. We propose that CEO duality will generate a positive (negative) significant impact on the firms’ corporate governance when state owners tend to monitor their CEOs on the basis of profit (non-profit) considerations. We test our hypotheses by examining the relations between CEO duality and CEO turnover in Chinese listed companies that are ultimately controlled by central or local governments. We find that CEO duality is negatively related to turnover in marginal profit-making firms where turnover would be value-enhancing. This suggests that CEO duality is detrimental to these firms’ corporate governance because it entrenches relatively poorly performing CEOs. Duality is also negatively related to turnover in high-profitability firms where turnover would be non-value-enhancing. This suggests that CEO duality might positively contribute to the corporate governance of these firms by reducing the occurrence of non-value enhancing turnover. Overall, our study suggests that CEO duality is a double-edged sword in corporatized state-owned firms.     

CEO Reciprocal Interlocks in French Corporations

In France the chairperson of the board is mostoften the firm's CEO. This position strengthensthe insiders' hold on the board of directors.Moreover, a large fraction of outside directorsis composed of CEOs of other firms. Thereciprocal interlocking of CEOs creates the possibility of mutual interdependence of CEOs.We investigate factors explaining reciprocalinterlocking directorates of CEOs in Frenchcorporations. Our results indicate that CEOs oflarger firms hold more reciprocal CEOinterlocks and when CEOs have more outsidedirectorships, CEOs hold more reciprocalrelationships. We also find a positiverelationship between the number of CEOsreciprocal interlocks and their firms'performance measured by ROA. We find evidencethat CEOs hold more reciprocal interlocks whena blockholder is present on the CEO's board.     

Agent or Steward: The Target CEO in a Hostile Takeover: Can a Condemned Agent be Redeemed?

This article examines the differences, tensions and overlaps between agency and stewardship theories of corporate governance. The context is a hostile bid for Blue Circle Industries, a FTSE 100 company, and the focus is upon its Chief Executive Officer’s actions in response. CEOs occupy a position of pivotal importance during such takeover bids, and it is salient to examine their resultant motivations and payoffs. While agency theory suggests that CEOs may act in self-interested ways, diverging from the interests of shareholders, ongoing stewardship theory sees CEOs as fundamentally honest and caring about their company and shareholders’ interests. The hostile bid is an opportunity for the target CEO to fight at any cost, or to act in the best interests of stakeholders.In examining the target CEO’s actions, this article suggests there is more complexity than these two theories acknowledge and the relationship between them is not one of simple opposition. The article identifies a framework for making sense of CEO/stakeholder relationships, and highlights the importance to boards of understanding how CEOs manage differential stakeholder pressures over time.     

Gaining the ultimate power edge: Women in the dual role of CEO and Chair

Using archival data, the authors explored whether female CEOs possess as much structural power as male CEOs and what demographic characteristics are essential for female CEOs to have in order to increase their structural power in their firms. The authors use status characteristics and human capital theories to develop hypotheses. Findings show that female CEOs do not possess as much structural power as male CEOs as proxied by attaining a dual CEO/Chair role in the firm. Instead of dual CEO and Chair roles, female CEOs are more likely to be given the less powerful role of CEO and President. Moreover, female CEOs are more likely to gain structural power if they are entrepreneurs, work in large companies, or possess an elite education.     

The face of wrongdoing? An expectancy violations perspective on CEO facial characteristics and media coverage of misconducting firms

We examine the extent to which CEO facial characteristics matter in media coverage of firms implicated in corporate wrongdoing. We build on literature discussing that leaders’ faces may convey subjective behavioral expectations and that outsiders often over-rely on facial cues when making social judgments. We situate these insights in the context of corporate wrongdoing, where information incompleteness may be particularly high, potentially prompting outsiders to draw on CEO facial characteristics in forming their social judgments. Drawing on Expectancy Violations Theory, we hypothesize that firms led by CEOs expected to be more trustworthy, as inferred from their lower facial width-to-height ratio (fWHR), will draw greater attention and more negative opinions from the media in the wake of corporate wrongdoing. Results of an experiment (Study 1) where CEO fWHR was digitally manipulated support this counterintuitive logic, while findings based on an archival study of corporate wrongdoing of US firms from 2003 to 2016 (Study 2) partly generalize the rationale in the field setting. Our findings suggest that subjective expectations inferred from CEO faces may serve as part of a complex and underexamined source of variation in media coverage of misconducting firms. We discuss implications for theory and practice.     

CEO behavioral pattern expectations for physician executives

This is a report on the second part of a two-stage survey. The first part of the survey, reported in the Nov. 1994 issue of Physician Executive, dealt with physician executive behavior tendencies as viewed from the perspective of physicians, largely in hospitals. In the follow-up portion of the survey, the views of hospital CEOs on this subject were sought. CEOs were also asked for their views on the roles of physician executives and on what they were seeking in physician leaders. CEOs were asked to assess these issues in terms of the ideal physician executive, not the persons currently holding such positions in their organizations. Finally, this second report draws on the results of both parts of the survey in order to make comparisons between the views of the two groups of managers.     

CEO Incentives and Customer‐Supplier Relations

This study explores how suppliers adjust their relation‐specific investments (RSI) in response to the different risk‐taking incentives provided by the customer firm to its CEO, during normal and transition periods. We investigate this relation using 17,553 customer–supplier transactions over the 1993–2013 period. We find strong evidence consistent with the risk‐taking argument. Specifically, we find that an increase in the risk‐taking incentives of customer CEOs leads to a decline in suppliers’ RSI in normal periods, but an increase in RSI during transition periods. We employ the FAS‐123R mandate to show that an exogenous reduction in customer CEO's incentive pay increases suppliers’ RSI. We reaffirm the effect with the passage of the Sarbanes–Oxley Act as a secondary quasi‐natural experiment. Finally, we examine several scenarios that either amplify or attenuate the observed relation, based on factors such as financial constraints, distress, growth opportunities, industry competition, and other firm characteristics. Our study contributes to the literature that examines the interplay between corporate policy and product market relationships.     

CEO humility,narcissism and firm innovation: A paradox perspective on CEO traits

We examine how two seemingly contradictory yet potentially complementary CEO traits—humility and narcissism—interact to affect firm innovation. We adopt a paradox perspective and propose that individuals can have paradoxical traits and that, in particular, humility and narcissism can coexist harmoniously, especially among the Chinese, whose philosophical tradition embraces paradoxical thinking and behaving. CEOs that are both humble and narcissistic are hypothesized to be more likely to have socialized charisma, to cultivate an innovative culture, and to deliver innovative performance. Two studies using multisource data involving 63 CEOs, 328 top managers, and 645 middle managers in Study 1 and 143 CEOs and 190 top managers in Study 2 support the hypotheses and point to new directions for studying CEO traits and their effects on firm outcomes.     

Executive compensation in banks: insights from CEO equity incentives and securitization transactions

This paper investigates whether CEO equity incentives promote risk-taking activities in the financial industry. Prior research shows that, during the recent credit crisis, banks whose CEOs had high equity incentives performed significantly worse than banks whose CEOs had low equity incentives. A possible explanation for this result is that the incentive to boost stock price induced CEOs to take risks that turned out to be extremely costly. Focusing on securitization transactions that were among the fundamental causes of the financial crisis and using a sample of US financial institutions, the paper provides evidence that banks whose CEOs had high equity incentives engaged in securitization transactions to a greater extent than did financial institutions guided by CEOs with low equity incentives. Moreover, the paper shows that CEOs with high equity incentives securitized riskier loans than did CEOs with low incentives. This study helps to clarify the role of equity-based compensation in promoting risk-taking behaviors in banks.     

Strategic control at the CEO level

This study of 108 corporations is intended to identify and validate those strategic control factors that contribute directly to the success of strategic decisions made at the level of the CEO which are subsequently implemented throughout the organization. In direct response to a comprehensive questionaire, 61 CEOs rated nine strategic control factors. Only the ratings of CEOs were accepted and processed in this study. Their ratings revealed areas of obvious strength and correctable weakness in their perceptions of strategic control within their respective organizations. These ratings tended to validate a conceptual process model of strategic control.     

Undermining incentives: CEO reactions to compensation rebalancing

Directors commonly “punish” CEOs for overly risky behavior by rebalancing their compensation to include more restricted stock and fewer stock options. This paper extends the behavioral-agency model to describe how CEOs will manage their holdings of stock and stock options in response to this form of compensation rebalancing. In doing so, it finds that CEOs respond by selling existing stock holdings and accumulating option holdings. This behavior achieves the opposite incentive structure that such rebalancing intends to create, raising questions about the effectiveness of compensation rebalancing in reducing risky decision making.     

Re‐examining the Glass Cliff Hypothesis using Survival Analysis: The Case of Female CEO Tenure

We use the glass cliff to study the appointment and employment duration of 193 female CEOs between 1992 and 2014 in a sample of large, small and mid‐size North American firms. Consistent with the glass cliff, we find that women are appointed as CEOs in precarious situations. However, we find female CEOs are 40% less likely to face turnover at any point after appointment than male CEOs. This conflicts with an implication of the glass cliff and differs significantly from existing research which shows that female CEOs have only a slightly lower risk of turnover than male CEOs. Our larger, more recent sample captures changes in the labour market that explain the departure from the results of earlier studies. We find evidence that the lower turnover rate of female CEOs is related to firms’ desire to avoid the negative publicity that would accompany their termination, and we also show that greater education has a positive impact on CEO job security.     

A mixed-methods study of CEO transformational leadership and firm performance

This mixed-methods study explores the relationship between CEO transformational leadership and firm performance relying exclusively on secondary data. We used a random sample comprising of 42 CEOs of publicly-listed US and European companies. We evaluated their transformational leadership drawing upon media sources which were content analyzed to create individual CEO profiles. These profiles were then given to a panel of three judges who rated the CEOs on their transformational leadership style. We obtained the firm performance data from Thomson Datastream. Our results showed significant associations between intellectual stimulation and inspirational motivation respectively, and different financial performance indicators. We also observed a tendency of positive relationships between individualized consideration and firm performance. These findings remained significant after controlling for company baseline performance, firm size, CEO tenure, and company location. Our findings largely support the positive role of CEO transformational leadership in shaping firm performance.     

The perks of narcissism: Behaving like a star speeds up career advancement to the CEO position

It is widely acknowledged that narcissism is a peculiar characteristic of leaders, such as CEOs. However, the role of narcissism in CEO emergence and appointment has not been studied yet. We overcome this gap by studying whether having a highly narcissistic personality allows individuals to become CEOs sooner. We posit that these individuals have quicker career development, climbing the hierarchical chain faster. We also hypothesize that this relation may be moderated by the firm's characteristics, comparing family and nonfamily firms. Family firms are the most widespread organizational form of firms around the world, and their peculiarities might affect the appointment of narcissistic CEOs. Estimates on a sample of 172 individuals partially confirm the hypotheses. Highly narcissistic individuals become CEOs quicker, regardless of whether the firm is a family business or not. Narcissistic individuals thus benefit from their personality when aiming at becoming CEOs faster in their career advancement.