The influence of top management corporate networks on CEO succession

We analyze empirically how supervisory board members with multiple directorships affect the decision to hire an inside or outside CEO successor. While a growing number of both theoretical and empirical studies analyze the influence of corporate performance and size or the ownership structure on this decision, the role of multiple board memberships within the CEO recruitment process has been widely neglected so far. The present study is based on panel data of the largest German companies covering the period from 1996 to 2008. Applying competing risk estimations we find a weak and positive association between the number of external directorships of the supervisory board members and internal CEO replacements. Distinguishing between different groups of external board positions, we find that external executives on the supervisory board increase the likelihood of external CEO replacements. In line with empirical findings for the US we argue that external executives improve the assessment of potential CEO successors leading to more outside CEO replacements. In contrast, we find evidence that external supervisory board mandates of the supervisory board members cause more internal CEO replacements. This finding indicates a substitution of external expertise of the executives by multiple supervisory board mandates but could also reflect a reduction of the monitoring intensity of the supervisory board.     

An Empirical Investigation of Terrorism-induced Stress on Expatriate Attitudes and Performance

Despite international terrorism's increasing relevance for international business, the effects of terrorism that confront employees during assignments abroad have hardly been investigated. Applying a stress perspective, this article analyzes the impact of terrorism-induced stress on attitudes and the performance of expatriates. Employing data from 143 expatriate managers in high-risk countries, the study shows that several terrorism-related stressors create a significant stress level for the individual, causing negative work attitudes and attitudes towards host country nationals (disaffection). This eventually leads to worse performance. We applied partial least squares (PLS) structural equation modeling (SEM) to analyze the entire impact path and found substantial support for our hypotheses. Of all the relevant stressors, intra-family conflicts due to terrorism have the greatest impact.     

Insider ownership and corporate performance: evidence from Germany

In this paper we address the question whether insider ownership affects corporate performance. Evidence from studies dealing with Anglo-Saxon countries is rather inconclusive, especially because results seem to be significantly affected by endogeneity. Economically, this is due to the fact that in these countries insider ownership seems to be mainly driven by management’s compensation contracts. We argue that Germany is different in this regard, as insider ownership is often related to family control, stock-based compensation is less widespread, and the market for corporate control used to be less developed. Starting from this presumption, our data allows an unbiased observation as to whether insider ownership affects firm performance. Using a pooled data set of 648 firm observations for the years 2003 and 1998, we find evidence for a positive and significant relationship between corporate performance—as measured by stock price performance, market-to-book ratio and return on assets—and insider ownership. This relationship seems to be rather robust, even if we account for potential endogeneity by applying a 2SLS regression approach. Furthermore, the results hold for a sub-sample of firms that did not have a stock-based compensation program in place. Moreover, we find outside block ownership as well as more concentrated insider ownership to have a positive impact on corporate performance. Overall, the results indicate that ownership structure might be an important variable explaining the long term value creation in the corporate sector.

The Criterial Crisis of the Academic World*

The author analyzes the crisis in standards in the academic world where symptoms of academic fraud and diminished quality are linked to increasing competitive pressure, demographic forces, and defects in the social system of professional control, examples of a criterial system with mechanical assessment technology that generates paradoxical outcomes. The paper addresses such issues as redundancy of publications and defects in the peer review system, drawing examples from the fields of medicine, science and sociology, It is argued that a decline in academic standards is facilitated by the confusion involved in differentiating criteria from standards. Further analysis of criterial systems is suggested, along with the need for an explicit examination of academic values and quality.     

This is not a race, this is a farce: Formula One and the Indianapolis Motor Speedway tire crisis

Formula One is the most technologically advanced and financially lucrative form of motorsport in the world with global audiences in the billions over the course of a season. A highly unusual and potentially deadly set of events took place during the Friday practice for the sixth annual United States Grand Prix at the Indianapolis Motor Speedway. Controversy and blame soon followed. Using Benoit's public relations and image restoration strategy framework, this paper examines the different strategies employed during the crisis by the Formula One teams, Michelin, the Federation Internationale De L’Automobile, Formula One Management, and the Indianapolis Motor Speedway. An examination of the crisis situation at the United States Grand Prix allows this study to expand Benoit's initial framework into sport as well as examining the implications for public relations and image repair strategies.     

The importance of preservation of the ethical principle of equipoise in the design of clinical trials: relative impact of the methodological quality domains on the treatment effect in randomized controlled trials

Previous research has identified methodological problems in the design and conduct of randomized trials that could, if left unaddressed, lead to biased results. In this report we discuss one such problem, inadequate control intervention, and argue that it can be by far the most important design characteristic of randomized trials in overestimating the effect of new treatments. Current guidelines for the design and reporting of randomized trials, such as the Consolidated Standards of Reporting Trials (CONSORT) statement, do not address the choice of the comparator intervention. We argue that an adequate control intervention can be selected if people designing a trial explicitly take into consideration the ethical principle of equipoise, also known as "the uncertainty principle."     

Paternity Establishment for Men’s Nonmarital Births

This paper uses the 2002 National Survey of Family Growth to examine paternity establishment among men’s nonmarital births. Using births as the unit of analysis, I find that paternity establishment for first births (n = 661) is linked to race/ethnicity and relationship status at birth, and these characteristics are associated differently with the timing and location of paternity establishment (in-hospital or at some later point). For higher-parity births (n = 429), paternity establishment for a particular birth is strongly related to prior paternity and fertility behaviors. Paternity is less likely to be established for a higher-parity birth if the father failed to establish paternity for at least one earlier birth, and third or higher-parity births are far more likely to have paternity established at a subsequent point than at the hospital.