Ceo Duality as a Double-Edged Sword: How Boards of Directors Balance Entrenchment Avoidance and Unity of Command.

Finkelstein, Sydney; D'Aveni, Richard A.

doi:10.2307/256667

Cited by 1,017 publications

(673 citation statements)

References 64 publications

Supporting

Mentioning

627

Contrasting

Unclassified

Order By: Relevance

“…Principal-agent theory proposes that the chair-CEO duality will weaken supervision and control of the board and increase governance risk. Meanwhile, such a combination promotes the interaction and information communication between TMT and the board, and prevents conflict [13]. Management autonomy theory and decision theory hold that corporate performance has much closer relationship with TMT characteristics under chair-CEO duality.…”

Section: Leadership Structure Moderates the Relationship Between Tmt mentioning

confidence: 99%

Study on TMT Heterogeneity’s Effects on Corporate Performance from the Perspective of Leadership Structure

He¹,

Li²,

Li³

2016

OJBM

View full text Add to dashboard Cite

Based on Upper Echelons theory, this article makes use of a sample of 130 companies that experienced CEO succession due to performance decline to investigate whether the TMT heterogeneity impact on corporate performance and how the leadership structure of corporation moderates the relationship between them. It is shown that TMT age heterogeneity has a U-shaped relationship with corporate performance; TMT tenure heterogeneity and TMT educational levels heterogeneity have inverted U-shaped relationship with corporate performance; while the leadership structure of corporation has a moderating effect on the relationship between TMT age heterogeneity, TMT tenure heterogeneity and corporate performance. The findings of this study would be helpful to cultivate and construct the entrepreneurial TMT, and to design corporate leadership structure.

show abstract

Section: Leadership Structure Moderates the Relationship Between Tmt mentioning

confidence: 99%

Study on TMT Heterogeneity’s Effects on Corporate Performance from the Perspective of Leadership Structure

He¹,

Li²,

Li³

2016

OJBM

View full text Add to dashboard Cite

show abstract

“…On the one hand, role duality indicates the absence of separation of decision control and decision management (Fama & Jensen, 1983), on the other, segregation of duties would indicate enhanced control and governance. Finkelstein and D'Aveni (1994) and Gul and Leung (2004) argue that a concentration of decision-making power may mitigate the independence of the board and reduce its effectiveness in its monitoring role. This result is similar to that reported by Forker (1992) in his study of dominant personality and quality of disclosure.…”

Section: Hypotheses and Research Designmentioning

confidence: 99%

Firm Resources, Corporate Governance and the Disclosure of Intangible Assets

Mkumbuzi¹

2015

ASS

View full text Add to dashboard Cite

The paper investigates the determinants of intangible asset disclosure with reference to the interaction of heterogeneous asset and governance characteristics of firms. Specifically, it considers R&D intensity as a measure of asset heterogeneity and multiple proxies for the effectiveness of the firm's corporate governance mechanisms and structures of accountability. Intellectual capital attributes are applied as the measure of disclosure quality and as the signalling mechanism through which management are able to inform markets of their competitive advantage. By applying the resource based view of the firm and signalling theory, the paper extends prior research on the determinants of intangibles disclosure through an analytical framework that examines the interaction of firm resources, corporate governance and intangibles disclosure. The theoretical framework combines the RBV of the firm in confirming intangibles as a necessary feature of disclosing firms' asset base and signalling as the means with which management disclose their competitive advantage. The results of the analysis indicate a positive relationship between R&D intensity, complexity and scope of activity and the presence of quality signalling responses. Also, the separation of the roles of chair and non-executive director, complemented by experienced non-executive directors promote quality signalling through the disclosure of intellectual capital attributes. These findings support the view that corporate governance mechanisms are only effective when applied in combination. Governance mechanisms bring about transparency and accountability through disclosure of these intangibles despite the potential competitive losses. The lack of proprietary costs that might otherwise restrict disclosure might be attributed to competitors' inability to imitate such intellectual capital resources and therefore their inability to duplicate such signals. The findings confirm the interaction between heterogeneous assets and governance mechanisms in the disclosure of intangibles as signalling mechanisms for management.

show abstract

“…While some scholars (Gabaix & Landier, 2008) argue that CEO compensation is determined by the talent, many other studies such as Fama (1980), Jensen (1993), Fama and Jensen (1983), Bebchuk and Fried (2003) advocate that it is the board's decision that determines CEO compensation. When CEO also holds the Chairman position, referred to as CEO duality, agency theory suggests that it might lead to CEO entrenchment and may result in weak monitoring (Finkelstein & D'Aveni, 1994). Prior empirical studies (e.g., Jensen, 1993;Core et al, 1999;Cyert et al, 2002;Fahlenbrach, 2009) all identified that CEO duality results in higher CEO compensation.…”

Section: Ceo Compensation and Board Qualitymentioning

confidence: 99%

CEO Compensation: Does Financial Crisis Matter?

Vemala¹,

Nguyen²,

Nguyen³

et al. 2014

IBR

View full text Add to dashboard Cite

The topic of CEO compensation has been highly debatable. The financial crisis of 2008 further prompted public and media to question executive compensation practices in the United States. This study investigates the effect of the financial crisis on CEO compensation and also examines various determinants of CEO compensation. Using a sample of Fortune 500 firms and 2241 observations, we find that financial crisis has a small but significant effect on CEO compensation. Firm performance, firm size, and CEO duality were found to have a significant effect on CEO compensation both pre and post-crisis. One major difference found between pre and post-crisis was in the composition of pay. While cash compensation decreased significantly post-crisis, equity-compensation increased.

show abstract

Ceo Duality as a Double-Edged Sword: How Boards of Directors Balance Entrenchment Avoidance and Unity of Command.

Cited by 1,017 publications

References 64 publications

Study on TMT Heterogeneity’s Effects on Corporate Performance from the Perspective of Leadership Structure

Study on TMT Heterogeneity’s Effects on Corporate Performance from the Perspective of Leadership Structure

Firm Resources, Corporate Governance and the Disclosure of Intangible Assets

CEO Compensation: Does Financial Crisis Matter?

Contact Info

Product

Resources

About