The purpose of this study is to explicitly focus on the roles of ownership concentration, ownership by the board, the chief executive officer (CEO) and the chairperson in the involvement and capabilities of chairpersons and other governors in their work.
In this study, the authors investigate the impact of the concentration of ownership, the ownership of the board, the CEO and the chairperson on the chairperson’s activity when the roles of the chairperson and the CEO are separated The empirical analysis of this study is based on a survey sent to Nordic listed firms.
The results show that the ownership characteristics of a company are important in determining the chairperson’s working hours, the chairperson’s communication with the CEO and the performance of governance activity. In addition, the authors found that while the ownership of the chairperson and the board of directors and ownership concentration improve governance activity, CEO ownership may undermine governance activity.
The primary implication of the study is that both ownership by internal governors and ownership concentration play an important role in determining the involvement of internal corporate governors.
The study provides unique evidence that ownership by the chairperson, concentrated ownership and ownership by the board can potentially mitigate the costs of separating the roles of the chairperson and the CEO.
We are grateful for the financial support from NASDAQ OMX Nordiska Stiftelse för främjande av vetenskaplig forskning på värdepappersområdet and Jan Wallanders och Tom Hedelius Stiftelse samt Tore Browaldhs Stiftelse. The authors thank the referee and seminar participants at Stockholm University, the 2015 Spring Conference of the Multinational Finance Society, and the 22nd Annual Conference of the Multinational Finance Society for their helpful comments.
Brunzell, T. and Peltomäki, J. (2015), "Ownership as a determinant of chairperson activity: a study of Nordic listed companies", Qualitative Research in Financial Markets, Vol. 7 No. 4, pp. 412-428. https://doi.org/10.1108/QRFM-09-2014-0029Download as .RIS
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