Search results

The purpose of this paper is to bring together a strategic choice perspective and an institutional perspective in order to address the key research questions: how do Russian founder-CEOs perceive the institutional environment when succession issues are taken into consideration?; how do the perceived characteristics of different formal and informal institutions affect the founder-CEO’s decision to delegate authority to a professional CEO?; and what are the main barriers to founder-CEO succession in threshold firms in emerging markets such as Russia?

Using a data set of 500 entrepreneurial companies from fast growing industries in Russia, the paper defines and studies threshold firms and analyses how various perceived characteristics of the institutional environment in emerging markets influence the likelihood of transition from founder management to professional management.

Institutional factors such as poor security of property rights and dependence of the business on relationships with government officials have a negative impact on the likelihood of founder-CEO succession in threshold firms in emerging markets. At the same time, the perception of contract law as insecure increases the likelihood of transition from founder management to professional management.

Most research on initial succession deals with internal organisational factors and does not consider external environments and their influence on founder-CEO departure and willingness to exit from company management. This study is unique in its focus on the external environment and institutional factors and their impact on management transitions in threshold firms in emerging economies.

While the relationship between non-family CEOs and corporate innovation in China has been widely studied, the results remain inconclusive. This study explores the relationship between non-family CEOs and corporate innovation in the context of intergenerational succession. It considers the background and background characteristics of non-family CEOs in an attempt to provide a theoretical foundation for human resource management and innovative strategic management that can be applied in the transformation of family companies.

The authors develop, then test, a series of hypotheses using an econometric analysis of a large sample of Chinese listed family firms. To control for endogeneity problems, such as missing variables in the model and the selectivity bias of the sample, propensity score matching (PSM) model is applied to analyze the panel data of 452 listed family firms from 2009–2019.

This study first validates the mechanism by which non-family CEO background characteristics affect innovation performance in family firms. It then reveals the varying moderating effects of two stages of intergenerational succession (i.e. later-generation participation in management and later-generation take-over management) that influence the relationship between non-family CEOs and corporate innovation.

The study's findings based on upper echelon and imprinting theory complement and extend existing research by revealing the impact of non-family CEOs from different backgrounds, and also identifying the role of intergenerational succession in the relationship between non-family CEO background characteristics and innovation performance.

The purpose of this study is to identify similarities and differences between the leadership practices of managing entrepreneurs and professional CEOs and to investigate how these impact on their immediate subordinates' satisfaction, commitment, motivation, and effectiveness (engagement).

A multiple‐respondents survey, aiming at CEOs and their immediate subordinates, was conducted. Factor analysis, correlations and moderated regression analysis were used in order to reach conclusions.

Two leadership dimensions are found to be most influential: being a good manager/mentor and articulating vision. Although good manager/mentor characteristics prove crucial for both types of CEOs, the effect of vision articulation on subordinates is moderated by the type of company the CEO is leading. No significant differences are found in the leadership style that the two types of CEOs adopt, except for their calmness and self‐possession, which is lower among entrepreneurs.

The findings raise questions regarding the differences in subordinate expectations from owners – CEOs, as opposed to professional CEOs; and point at certain characteristics which could be developed in order to enhance leadership effectiveness in both groups of top managers.

The study underlines the importance of sound vision development and articulation in entrepreneur‐run firms, as it appears that people working for such firms expect more direction from the Head. It is also sustained that good management and mentoring are essential in any kind of firm, in order to develop an effective, committed and motivated top management team, which will bring corporate success.

The purpose of this paper is to investigate the moderating effect of international trade on outside director system in Korean firms. The authors expected that Korean firms highly depending on international trade would mitigate the resource provision function of outside director system in order to reduce information asymmetry among global business partners. In addition, the authors tried to find out the functions of outside director system: the control function based on agency theory and resource provision function based on resource dependence theory.

The authors tested the hypotheses by Poisson regression with 2011 and 2002 Korean-listed manufacturing firms. The dependent variable is the number of excessively appointed outside directors and independent variable is CEO type: family CEO or professional CEO. The moderating variable is the dependency on international trade measured by export proportion out of total sales.

The authors found that not control but resource provision function was a main role of outside director system in Korean firms. The authors also found negative moderating effect of dependency on international trade, which means that firms highly depending on global market tended to consider outside director system as control function, namely “global standard.”

This paper is the leading study that tries to analyze empirically the relationship between international trade and the function of governance mechanism; outside director system in Korean firms. It also confirms that Korean firms adopted outside director system on the basis of the resource dependence theory.

The recent collapse of the corporate giant Steinhoff in South Africa (SA) has highlighted the risks of a dominant Chief Executive Officer (CEO) and an ineffective governing board. For this reason, the purpose of this paper is to scrutinize the influence of CEO power attributes and independent governing boards on the growth of a Johannesburg stock exchange-listed firm.

The purpose of this paper is to answer the research question “Under the monitoring role of the board, what CEO attributes, theoretically and in practice preeminent successful firm growth strategies?” This question was answered by examining 130 companies over six years using the econometric methodology of generalized least squares and ordinary least squares with the specific inclusion of generalized method of moments estimation due to its efficiency in controlling for unobserved heterogeneity, endogeneity, autocorrelation, heteroscedasticity, amongst others. The proxies for CEO power are CEO tenure, turnover and professional skills as well as the explanatory variable of board vigilance. The response variable was firm growth.

This study found that CEO tenure is negatively correlated with firm growth indicating that long-tenured CEOs may stagnate the firm's growth. Furthermore, CEO turnover was positively correlated with firm growth indicating that a new CEO may bring innovative strategies that link to this study's finding on CEO tenure. The membership of CEOs to accounting professional bodies and board vigilance are also positively correlated to firm growth.

SA firms' growth policy does not solely depend on the neoclassical fundamental determinants of profitability, net worth, and cash flows. Since the value relevance of assessing CEO attributes as well as board vigilance in the SA market has proved to be very significant and will contribute to future decision making on growth strategies. This study innovatively illustrates the different drivers of firm growth, which is distinct from the normal macroeconomic indicators. The practical contribution of the study lies in the fact that organizations now discern which CEO attributes contribute to sustainability and profitability.

The current depressed economic environment has several negative implications for the citizens of SA. The rising unemployment levels and inflation has deteriorated living conditions. For the economy to recover, SA needs its listed companies to remain strong performers to protect stakeholder interests and attract investments. The people responsible for steering the companies through this difficult time are the CEOs with the governing board protecting the public interest. This study examines these two important constructs concerning firm growth.

This study uniquely used a firm growth variable as opposed to the multitude of studies that used firm performance variables. Furthermore, this study's robustness was bolstered by an extensive theoretical framework employed to examine the value of a CEO as a firm growth stimulator. The period of this study is also unique as it examines firms in the aftermath of the global recession of 2008. This study provides a fresh perspective on firm growth indicators and has key implications for policymakers, stakeholders and regulatory establishments.

This study aims to examine whether a switching decision between a family CEO and a non-family professional CEO has a different effect on firm performance and what determines such a decision by family firms.

This study uses multiple regressions, Probit and univariate analyses, based the sample of family-controlled Chaebol firms in Korea for the 11-year period from 2001 to 2011.

Evidence found was consistent with the family entrenchment hypothesis: firms experiencing declining Q value are more likely to replace family CEOs with non-family CEOs, and that these firms, having switched to non-family CEOs, exhibit an improvement in firm performance as measured by the change in Q value. On the other hand, for those firms that replace non-family CEOs with family member CEOs, no evidence was found that the switching decision either decreases or increases firm performance. The results of Probit and univariate analyses suggest that firms switching to family CEOs tend to be larger, stock-exchange listed and more “central”, with more cash flow rights held by the controlling families and with relatively more equity holdings in the other affiliated firms of the same Chaebol group. In contrast, firms switching to non-family CEOs tend to be smaller, unlisted and less “central”, with less equity holdings in the other affiliated firms of the same Chaebol group.

This study sheds light on the different value implications and determinants of a decision between “family CEO” and “non-family CEO”.

The purpose of this study is to investigate the impact of non-founder CEO succession on firms’ research and development (R&D) decision, and further explore its mechanism and economic consequences.

Using founders’ personal-level information of entrepreneurial firms in the Chinese growth enterprise market from 2009 to 2015, the authors empirically investigate whether firms can be motivated to launch more R&D activities as the result of switching to non-founder CEOs. The author’s further test the impact of non-founder CEOs on R&D output to distinguish their motivation. Moreover, the authors use stepwise regression to explore the mechanism and possible channels.

The authors find that R&D investment significantly increases in firms with non-founder CEOs and the R&D output that comes in the form of patent exhibits an upward trending in numbers, too, ruling out non-founder CEOs’ incentive to chase private benefits. Specifically, the authors find that non-founder CEOs can promote R&D investment through their more professional human capital and better internal control. The authors also show mitigating effects under different circumstances on the relationship between non-founder CEOs and R&D investment.

This study helps the authors to understand the impact of non-founder CEO succession on R&D investment in emerging markets. It also indicates that human capital of non-founder CEOs is critical in driving firms’ innovation, proposing policy suggestions to improve formal intermediary labor market of professional CEOs.

This study provides elaborate theoretical analysis and empirical tests on the mechanism and economic consequences of (non-)founders’ impact on R&D activities.

The purpose of this study is to examine the impact of chief executive officer (CEO) personal characteristics on the performance of Indian commercial banks. Additionally, it also analyses the nonlinear relationship of CEO age and CEO tenure on the bank performance.

A balanced panel data approach has been used in this study. Particularly, the fixed effect estimation technique is used to examine the relationship between CEO characteristics and bank performance during the period 2009–2010 to 2016–2017.

The authors find that professional qualification of CEOs in finance stream enhances performance. Additionally, the impact of CEO duality is found to be positive and significant on performance. Male CEOs are beneficial for bank performance. Well experienced CEOs contribute to higher performance. The results are robust across the various proxies of bank performance, and sub-samples based on ownership, size of the bank and board size.

This study provides insights to policy regulators and policymakers who are entrusted with the appointment of the CEOs in the banks in the light of the ongoing regulatory reforms.

This study can be considered as one of the early studies, which examines the association between CEO characteristics and bank performance from an emerging economy perspective. It also extends the existing study by considering both public and private banks operating in India.

This study aims to investigate how three critical governance decisions by foreign firms impacted their survivability post-initial public offerings (IPO): the choice of CEO (founder vs non-founder); the power the founder CEO wields relative to the board in terms of CEO duality; and board size.

This study uses data from 86 foreign firms that completed IPOs in the US market between 2000 and 2008 and adopts a Cox proportional hazards model to examine how the founder, founder CEO duality and board size influence foreign firm delisting post-IPO.

A founder CEO or a founder CEO with duality (i.e. when a founder CEO is also chair of the board of directors) does not support a foreign firm’s survival post-IPO. Expectedly, board size has a negative impact on post-IPO firm survivability; however, founder CEO duality positively moderates this negative relationship. Therefore, founder CEO duality plays a positive indirect role in the context of post-IPO firms with large boards.

First, while the benefits of CEO duality have been empirically ambiguous, this study clarifies how founder CEO duality manifests its positive impacts in foreign listings. Second, by focusing on board cognition, this study confirms the negative impact of large boards, but highlights that this can be mitigated by governance leadership structure. Finally, despite organizational life-cycle theorists’ advocacy of the replacement of founder CEOs with professional CEOs in sizable ventures, this study shows the benefits of their retention when the board is large.

The aim of this paper is to provide board members, managers, and researchers of new ventures with insights into how to manage a first-time succession process successfully. Successful succession is defined, both in terms of the quality of the experience for the stakeholders involved – in other words, how the founder-CEO, the professional incoming CEO, the top management team, and board members experience the process regarding distrust, resentment, tensions, and intention to leave – and in terms of the effectiveness of the succession, meaning organizational performance levels such as sales growth and return on assets. Depending on the initiating forces of succession (i.e. emanating from founder-CEO, the top management team (TMT), and the board/venture capitalists), evidence is offered on how best to leverage the six factors to allow for a successful succession.

The research design is built on a case study conducted in 15 first-time successions in new ventures in the high-tech industry. Primary data (interviews, direct observation) and secondary data (archival and internal documents) were analyzed using mainly qualitative methods, enabling cross-comparison between the 15 cases under investigation.

Our cross-case data analysis uncovered six factors that shaped first-time successions in 15 new ventures. The analysis also revealed that the interplay between these factors, as well as their relative importance, differed depending on who initiated the succession (the founder, the TMT, or the board/venture capitalists). These different sets of interplays led to three patterns of factors that were managed differently in each case in order to ensure the success of a succession process: (1) in the “all hands-on-deck” pattern, a legitimate case for change and the inclusion of the TMT in the succession process are the factors in which to invest the most managerial efforts to ensure a successful succession process; (2) in the “hand-in-glove” pattern, the new CEO's soft skills and the relationship between the incoming and outgoing CEOs have to be leveraged for succession to succeed; and (3) in the “heavy hand” pattern, procedural fairness and succession timing have to be managed to ensure success. A total of six cases of unsuccessful succession were also analyzed. Based on this analysis, two types of malpractice are presented that compromise succession.

The findings are based on a comparative case study of 15 new ventures in the high-tech industry that have experienced first-time succession within the last two years. Further empirical evidence would be required to generalize our results to the high-tech industry at large.

This paper provides founders, managers, and board members with practical recommendations on how best to manage first-time succession in a new venture depending on the initiating force of the succession.

This paper highlights what past literature has not yet revealed, namely that the interplay of factors contributing to a successful succession varies depending on the initiating force behind it, and each succession needs to be managed differently if it is to prove successful. This paper thus enriches existing theory by filling the unexplored links between success in first-time succession and the initiating force of the succession. Some insights into frequently occurring malpractice in the succession process are also presented.