The double-edged sword of CEO/chairperson duality in corporatized state-owned firms: evidence from top management turnover in China

Firth, Michael; Wong, Sonia M. L.; Yang, Yong

doi:10.1007/s10997-012-9225-6

Cited by 22 publications

(10 citation statements)

References 64 publications

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“…However, our result also shows that CEO duality has a weakly positive relationship with ROA. The empirical evidence proved that CEO duality is a double‐edged sword regarding financial performance (Firth, Wong, & Yang, ). Hermalin and Weisbach () proved that CEO turnover appears to be more sensitive to performance when the board is more independent.…”

Section: Resultsmentioning

confidence: 99%

Do environmental, social, and governance activities improve corporate financial performance?

et al. 2018

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This study investigated the relationship between corporate efficiency and corporate sustainability to determine whether firms concerned about environmental, social and governance (ESG) issues can also be efficient and profitable. We applied data envelopment analysis to estimate corporate efficiency and investigated the nonlinear relationship between corporate efficiency and ESG disclosure. Evidence shows that corporate transparency regarding ESG information has a positive association with corporate efficiency at the moderate disclosure level, rather than at the high or low disclosure level. Governance information disclosure has the strongest positive linkage with corporate efficiency, followed by social and environmental information disclosure. Moreover, we explored the relationship between particular ESG activities and corporate financial performance (CFP), including corporate efficiency, return on assets and market value. We found that most of the ESG activities reveal a non-negative relationship with CFP. These findings may provide evidence about voluntary corporate social responsibility (CSR) strategy choices for enhancing corporate sustainability.

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Section: Resultsmentioning

confidence: 99%

Do environmental, social, and governance activities improve corporate financial performance?

et al. 2018

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“…CEO duality is also a common phenomenon among the Chinese organizations which can also devastate the firms' growth because of his/her dallying attitude while taking a decision [33]. Despite having a dual office, CEOs cannot save themselves from forceful turnover [34]. To encapsulate, despite a novel corporate mechanism, Chinese organizations are booming.…”

Section: Corporate Governance In Chinamentioning

confidence: 99%

Do Hierarchical Jumps in CEO Succession Invigorate Innovation? Evidence from Chinese Economy

et al. 2019

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The objective of this study is to analyze Chief executive officer (CEO) succession via hierarchical jumps in Chinese listed firms which orientate towards innovative activity. Good corporate governance is a vehicle to attain the competitive advantage which ultimately makes the organizational sustainability undeterred. The current study will test not only low hierarchical jumps but also medium hierarchical jumps in CEO succession. The study will identify the relationship between specific attributes like education, age and the duality of CEO successors via hierarchical jumps with innovation. We have analysed the data of Chinese listed firms on Shenzhen and Shanghai stock exchanges for the years 2012–2016. Significantly, it has been observed that CEO successors via hierarchical jumps orientate towards innovative activity amongst Chinese listed firms. Conclusively, empirical results have unveiled that hierarchical CEO succession escalates the firms’ innovation. It has also been contemplated that not only the low hierarchical jumps but also medium hierarchical jumps in CEO succession invigorate the organizational innovation. Mature firms with a substantial return on assets or earning per share and having less loan burden concentrate on innovative activity decisively. It has been demonstrated that specific attributes like education, age and the duality of hierarchical CEO successors have no relationship with innovation. The study results are robust via confirmation of 2SLS instrumental regression.

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“…The absence of separate decision‐making and control mechanisms, therefore, may result in negative outcomes. For example, Firth et al () show that CEO duality leads to CEO entrenchment despite declining firm performance. Similarly, Li and Tang () highlight excessive managerial discretion and risk taking as a consequence of CEO duality.…”

Section: Monitoring Mechanismsmentioning

confidence: 99%

Corporate Governance in China: A Meta‐Analysis

Mutlu

Essen

Peng³

et al. 2018

J Management Studies

102

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How has the impact of ‘good corporate governance’ principles on firm performance changed over time in China? Amassing a database of 84 studies, 684 effect sizes, and 547,622 firm observations, we explore this important question by conducting a meta‐analysis on the corporate governance literature on China. The weight of evidence demonstrates that two major ‘good corporate governance’ principles advocating board independence and managerial incentives are indeed associated with better firm performance. However, we cannot find strong support for the criticisms against CEO duality. In addition, we go beyond a static perspective (such as certain governance mechanisms are effective or ineffective) by investigating the temporal hypotheses. We reveal that over time, with the improvement in the quality of market institutions and development of financial markets, the monitoring mechanisms of the board and state ownership become more strongly related to firm performance, whereas the incentive mechanisms lose their significance. Overall, our findings advance a dynamic institution‐based view by substantiating the case that institutional transitions matter for the relationship between governance mechanisms and firm performance in the second largest economy in the world.

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The double-edged sword of CEO/chairperson duality in corporatized state-owned firms: evidence from top management turnover in China

Cited by 22 publications

References 64 publications

Do environmental, social, and governance activities improve corporate financial performance?

Do environmental, social, and governance activities improve corporate financial performance?

Do Hierarchical Jumps in CEO Succession Invigorate Innovation? Evidence from Chinese Economy

Corporate Governance in China: A Meta‐Analysis

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