Agency, Firm Growth, and Managerial Turnover

Anderson, Ronald W.; Bustamante, Maria Cecilia; Guibaud, Stéphane

doi:10.1111/jofi.12583

Cited by 44 publications

(16 citation statements)

References 58 publications

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“…Scholars have also examined CEO tenure and its relationship to the horizon problem-a CEO's lower motivation and incentives to act in the interest of the organization as the time for departure from the position grows near. Scholars have examined if CEOs engage in earnings manipulation-self-interested changes in accounting and investment choices in their final years of tenure-aimed at increasing the individual benefits that materialize within or after their incumbency (Adut et al, 2003;Anderson et al, 2018;Brickley et al, 1999;Heyden et al, 2017;Iliev & Vitanova, 2019;Page, 2018;Sampson & Shi, 2020;Wowak et al, 2011;Zhang, 2008). Scholars argue that as CEO tenure advances, CEOs enjoy the discretion needed to allocate resources and influence a firm's accounting in a way that serves their interests.…”

Section: The Horizon Problemmentioning

confidence: 99%

CEO tenure: An integrative review and pathways for future research

Darouichi

Kunisch

Menz

et al. 2021

Corporate Governance

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Research Question/Issue: Chief executive officer (CEO) tenure-the time a person spends in the CEO position-is a key observable characteristic of the CEO that has attracted considerable attention in the fields of management and accounting/finance.Yet, the research has evolved in parallel streams, and scholars have used CEO tenure as a proxy for various aspects of CEO givens and behaviors. The purpose of this paper is to consolidate, assess, and integrate the extant knowledge about CEO tenure from the fields of management and accounting/finance and, on that basis, stimulate future research.Research Findings/Insights: Our review reveals five key themes in CEO tenure research that have been studied across the management and accounting/finance fields: (1) CEO tenure and motivations; (2) CEO tenure and power; (3) CEO tenure and social capital; (4) CEO tenure and human capital; and (5) CEO tenure and stakeholder perceptions. We review the extant research along these research themes, highlighting the collective insights, contributions, and shortcomings within and between these themes.Theoretical/Academic Implications: Our review suggests that CEO tenure is a multifaceted, complex construct. To advance extant knowledge, we propose three pathways for future research: (1) substantiating knowledge within themes;(2) expanding knowledge across themes; and (3) advancing knowledge about temporal dynamics. We hope that research along those lines will help foster a richer and deeper understanding of the dynamic and complex nature of CEO tenure, which will also advance our understanding about CEOs in general.Practitioner/Policy Implications: Our study offers a comprehensive understanding of the nature of CEO tenure and its implications. Such an understanding can be leveraged to define appropriate policies and governance decisions that account for the dynamic nature of the CEO position.

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Section: The Horizon Problemmentioning

confidence: 99%

CEO tenure: An integrative review and pathways for future research

Darouichi

Kunisch

Menz

et al. 2021

Corporate Governance

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“…They clear the situation by using the data from the year 1995 of the USA's three key industries. Their study indicated that when a firm is going through severe distress, payment of the dividend is restricted by the creditors, thus it becomes useless to utilize the policy of dividend to increase firm growth (Anderson et al, 2017;al Ahbabi & Nobanee, 2019).…”

Section: Journal Of Entrepreneurship Management and Innovationmentioning

confidence: 99%

Sustainable Growth of Nonfinancial Firms: An Empirical Examination of Emerging Economies

Mubeen

Ahmed

Iqbal

et al. 2021

JEMI

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The classic model of sustainable growth presented by Higgins is extensively used in accounting and finance research. This research empirically examines this model which was suggested to be underestimated in the existing literature. The investigation was performed using data from 2000 to 2015 for seven emerging countries. To find out the mean difference in growth between secondary equity issuing firms and non-issuing firms, we used an independent sample t-test. To identify the factors affecting differences in sustainable growth and realized growth, regression analysis was performed and a panel of seven countries for sixteen years data was used to estimate the panel regression. The study found the Higgins’ model to be underestimated. One of the main factors of underestimation of the model was found to be the secondary equity issue. This factor was observed to be significant in the case of five countries i.e. Pakistan, India, Korea, Indonesia and Brazil while the same was found insignificant in Turkey and China. Also during the examination, firm-specific factors that are important for the underestimation of the SGR (Sustainable Growth Rate) model were detected which include leverage and size, whereas dividend policy and profitability gave mixed results. Our study suggests that firms with secondary equity issues are more likely to have sustainable growth than firms not having secondary equity issues.

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“…(5) Can the government influence the discount rate and the long-term production efficiency to adopt the VC's optimal exit choice as the overall optimal exit decision? For parameter selection, we refer to Sannikov [28], DeMarzo and Sannikov [33], Anderson et al [34], and Williams [35].…”

Section: Numerical Experimental Analysismentioning

confidence: 99%

Exit Decision of Venture Capital Based on Linear Contract in Continuous Time: IPO or M&A

Ding

2020

Complexity

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Based on the assumption that the long-term value of a venture capital satisfies the algebraic Brownian motion, we develop a continuous-time exit model of venture capital under different exit modes, namely, initial public offering (IPO) and mergers and acquisitions (M&A). The employee incentive problem is analyzed jointly with the exit decision of the firm in terms of the exit timing and the exit mode. Further, the problem of capital exit is considered from two perspectives, namely, optimal venture capital and social welfare maximization, and the differences between these exit decisions are compared. Our model predicts that the timing of an IPO, the purpose of which is to maximize the utility of the capitalists, lags behind the exit timing, whose purpose is to maximize social welfare. Using a numerical analysis, this paper also proves that increasing the production efficiency, lowering the interest rates, and improving risk management can make the exit decision of venture capitalists converge with that of maximizing social welfare.

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Agency, Firm Growth, and Managerial Turnover

Cited by 44 publications

References 58 publications

CEO tenure: An integrative review and pathways for future research

CEO tenure: An integrative review and pathways for future research

Sustainable Growth of Nonfinancial Firms: An Empirical Examination of Emerging Economies

Exit Decision of Venture Capital Based on Linear Contract in Continuous Time: IPO or M&A

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