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| Author: | Boyer, M.M. Ortiz-Molina, H. |
| Title: | Career concerns of top executives, managerial ownership and CEO succession |
| Journal: | Corporate governance
2008 : MAY, VOL. 16:3, p. 178-193 |
| Index terms: | USA companies board of directors policy careers stocks shareholders top management executives |
| Freeterms: | succession ownership |
| Language: | eng |
| Abstract: | It is hypothesized herein that a top manager's stock ownership (here as: o-s.) in the firm signals to the board information about his/her privately known ability to run the company. As a consequence, the outcome of a CEO succession (herein as: sccn.) is affected by the managers' o-s. choices, therefore depending on their career concerns. Based on the study of CEO turnover events in the U.S. firms, there is found support for the basic hypothesis. It is specifically found that 1. lower insider o-s. makes outside CEO sccn. more likely, 2. higher o-s. by an insider increases his/her chances of promotion, 3. non-appointed managers with higher o-s. are more likely to reduce their o-s. stake or to leave the firm following CEO sccn., and 4. o-s. reduction and departure decisions are more likely following outside CEO appointments. |
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