This paper analyzes changes in shareholder value and firm performance in relation to the delay (or lack thereof) in CEO succession. I find that, on average, delay in succession is associated with ...stronger performance after an unplanned CEO departure. However, the value effect of delay varies and not all firms benefit from long delay. Firms with higher stock price volatility and those whose CEO is hired away experience lower performance. These results suggest that delay affects frictions in the CEO labor market. The impact of delay is particularly important when firms have no succession plan in place.
A game of thrones—Dynamics of internal CEO succession and outcome Blank, Brian; Hadley, Brandy; Minnick, Kristina ...
European financial management : the journal of the European Financial Management Association,
January 2022, 2022-01-00, 20220101, Letnik:
28, Številka:
1
Journal Article
Recenzirano
We examine the implications of chief executive officer (CEO) succession methods for firm outcomes and executive incentives. Focusing on internal CEO successions, we find that the largest U.S. firms ...typically rely on two types of succession methods, namely, heir apparent and horse race successions. Although heir apparent and horse race CEO candidates have similar qualifications, the consequences of these two succession methods differ significantly. We find that horse race successions induce conflict and are detrimental to firm performance but not necessarily to the newly appointed CEOs. Our findings suggest succession method influences firm performance, executive incentives and CEO labour markets.
We investigate whether social capital influences tournament incentives and income differences between the chief executive officer (CEO) and median worker. We find that firms headquartered in US ...counties with stronger norms of cooperation or social capital have lower tournament and income differences. Firm value is higher when compensation is consistent with local norms. The results hold for alternative measures of social capital, instrumental variables, and quasi‐experiments related to the legalization of marijuana and firm headquarter relocation. These findings suggest that local social norms influence income differences and firm performance.
Purpose
This paper aims to investigate the roles of non-CEO inside directors (NCIDs) in the new CEO-firm matching process using the context of unplanned CEO departures when immediate CEO succession ...planning becomes a sole board responsibility. Although critics argue that inside directors decrease the monitoring effectiveness of a board, inside directors arguably possess superior firm-specific experience and knowledge that can be beneficial during the leadership transition.
Design/methodology/approach
The authors use a comprehensive, manually collected data set of unplanned CEO departures from 1993 to 2012.
Findings
The authors find that NCIDs play an important role in the CEO transitioning process. They help firms identify qualified inside replacements and provide stability as the new permanent or interim CEO. In addition, NCIDs facilitate the transfer of information and help the new external CEOs succeed. They show that the longer the NCID stays with the company, the longer the tenure of the new CEO. They also document that the presence of NCIDs improves operating and stock performance; especially when the new CEO is hired from outside of the firm.
Practical implications
The impact of NCIDs is particularly important when the firm hires an outsider as the new CEO. These results suggest that board composition affects frictions in the CEO labor market.
Originality/value
The literature has predominantly focused on the downside of having inside directors. Too many inside directors on a firm’s board is often associated with ineffective boards and entrenchment. To the contrary, the authors focus on a potential benefit of having inside directors.
This paper investigates whether and how lead time in CEO succession matters by comparing disruption costs in firms with planned retirements to those with unexpected CEO departures due to death or ...illness. Using a comprehensive manually-collected dataset of CEO turnovers from 1999 to 2008, I find evidence that firms with planned CEO retirements have significantly longer lead time and lower disruption costs. Specifically, longer lead time is associated with more favorable cumulative stock performance and firm operating performance around the outgoing CEO’s departure. In fact, firms can save approximately $136 million when there is lead time to plan for succession.
This paper analyzes firms’ choice of replacement CEOs after unexpected CEO turnovers, and the impact of the replacement decision on shareholder wealth. More specifically, I investigate whether the ...selection of replacement CEOs from the board facilitates a smoother leadership transition. I find that while selecting replacement CEO from existing board members allows the company to quickly fill the CEO position, thereby reducing uncertainty and transitional costs (measured by new CEO turnover, senior management turnover and delay), it may not be beneficial to shareholders. I provide evidence that replacing departing CEO with a board member is negatively associated with stock performance for up to two years. This paper is a step forward towards the understanding of the roles boards play in the CEO succession and new CEO hiring process.
Adverse drug reactions (ADRs) reduce patients' quality of life, increase mortality and morbidity, and have a negative economic impact on healthcare systems. Nevertheless, the importance of ADR ...reporting is often underestimated. The project “FarmaREL” has been developed to monitor and evaluate ADRs in haematological patients and to increase pharmacovigilance culture among haematology specialists. In 13 haematology units, based in Lombardy, Italy, a dedicated specialist with the task of encouraging ADRs reporting and sensitizing healthcare professionals to pharmacovigilance has been assigned. The ADRs occurring in haematological patients were collected electronically and then analysed with multiple logistic regression. Between January 2009 and December 2011, 887 reports were collected. The number of ADRs was higher in older adults (528; 59%), in male (490; 55%), and in non‐Hodgkin lymphoma patients (343; 39%). Most reactions were severe (45% required or prolonged hospitalization), but in most cases, they were fully resolved at the time of reporting. According to Schumock and Thornton criteria, a percentage of ADRs as high as 7% was found to be preventable versus 2% according to reporter opinion. Patients' haematological diagnosis, not age or gender, resulted to be the variable that most influenced ADR, in particular severity and outcome. The employment of personnel specifically dedicated to pharmacovigilance is a successful strategy to improve the number and quality of ADR reports. “FarmaREL”, the first programme of active pharmacovigilance in oncohaematologic patients, significantly contributed to reach the WHO “Gold Standard” for pharmacovigilance in Lombardy, Italy.
Aims. To determine the prevalence of women of childbearing age with schizophrenia and bipolar disorder exposed to antipsychotic (AP) drugs and mood stabilizers (MS) in Lombardy, a European region of ...10 million inhabitants and 1 752 285 women of childbearing age. Methods. The data concerning psychiatric care, drug treatments and pregnancy outcomes were retrieved from local administrative databases during a 12-month census period. Results. During a 12-month census period, 2893 women of childbearing age with schizophrenia (74.8% of all women of childbearing age with schizophrenia) and 918 with bipolar disorder (80.1% of all women of childbearing age with bipolar disorder) were exposed to AP drugs or MS, yielding a prevalence of exposure for women with schizophrenia of 1.65 (95% confidence interval (CI) 1.59-1.71) per 1000 female inhabitants, and for women with bipolar disorder of 0.52 (95% CI 0.49-0.55) per 1000 female inhabitants. Persistent exposure to potentially teratogenic medications accounted for one in every 1000 women of childbearing age. Of the 57 pregnancies in women with schizophrenia, normal delivery was recorded in 23 (40%) cases; of the 26 pregnancies in women with bipolar disorder, normal delivery was recorded in 10 (38%) cases. Conclusions. In women of childbearing age with severe mental disorders, exposure to psychotropic drugs is substantial, which suggests that the issue of reproductive health is epidemiologically relevant and a major public health concern.
Introduction This study presents the first results of a project on alexythymia and emotional connections in a sample of 8 patients with EDs. The project aims to evaluate changes in emotional ...expressions through the language used, by means of the Italian measure of the referential process. Changes in the alexithymic condition will be examined through the outcome and qualitative analysis of the psychotherapeutic process. Method 25 verbatim transcribed psychotherapeutic sessions were analyzed and correlated with TAS20, EDI-2, PBI, BUT, SWAP200, and between these and the narrative indices of the IDAAP. Results The relation between TAS20 and PBI supports a link between alexythymia and parenting styles: neglect and overprotection seem to contribute to difficulties in forming emotional connections. The positive correlation found between the TAS20 and some EDI2 subscales indicates a tendency to express misunderstood stimuli by means of the body. A positive correlation between MHIWRAD2 and TAS20 may suggest strong phases of emotional activation due to emotional dysregulation. The analysis of the significant correlations between the PBI and the RA measures indicate that parenting styles are related to language. A positive correlation between the IWRAD indices and maternal overprotectiveness was found: maternal overprotectiveness may be associated to strong emotional activation which is in turn characterized by emotional dysregulation. The associations between the narrative indices and the high functioning measure of the SWAP200 suggest that the reflexive components is related to high functioning; emotional dysregulation, as expressed by the variability in RA peaks, seems to be connected to low functioning.
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