Board influence on the selection of external accounting executives

Vafeas, Nikos; Vlittis, Adamos

doi:10.1016/j.bar.2014.08.005

Cited by 2 publications

(2 citation statements)

References 66 publications

(62 reference statements)

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“…The result as displayed in Table 5 shows that blockholders ownership is significant at 5% level with a positive coefficient and p-value of 0.040, which implies that, the more the percentage of blockholders ownership in the company, the higher the probability of selecting an outside CEO. This finding supports the hypothesis and it agrees with the previous empirical results obtained particularly by Vafeas & Vlittis (2014), Ishak et al (2012), and Thanh & Heaney (2013) that firms dominated with blockholders are more independent and are inclined to select external candidates as CEOs.…”

Section: Methodssupporting

confidence: 92%

“…Blockholder controlled firms are more likely to select an outsider candidate as successor. Vafeas & Vlittis (2014) argue that ownership structure is a very important determinant of appointing an outside CEO. This is because of the need for policy and strategy changes for improved performance, especially as the new CEOs are not parts of the existing policies and strategies and therefore, will be in better position to introduce new changes to improve the fortune of the corporation (Ishak et al, 2012).…”

Section: Block Holder Ownershipmentioning

confidence: 99%

See 1 more Smart Citation

Outsider vs insider: Does firm governance matter?

Abdullahi

Ishak

Sawandi

2018

BEH

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As CEO turnover occurs, the company may select an insider or outsider as a successor. This study attempts to ascertain whether firm performance, female directors, board religiosity and blockholder ownership influence the decision to appoint an internal or external candidate. Results from logistic regression analysis on 72 succession events over a five-year period (2011 to 2015) reveal that firms which are controlled by blockholders and those with females on their boards tend to select an outsider as the successor. Meanwhile, firms that have Muslims on their boards are more likely to select insiders as successors. This study implies that poor firm performance does not necessarily lead to outside CEO selection choice. On the overall, the findings indicate that blockholder ownership and gender diversity in the boardroom matter in the Nigerian corporate landscape.JEL Classifications: M41, M42, M48, G34, G38

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Section: Methodssupporting

confidence: 92%

Section: Block Holder Ownershipmentioning

confidence: 99%