Perk Consumption and CEO Turnover

This study examines the relationship between perk consumption and forced CEO turnover. The results based on Chinese firms indicate that the likelihood of forced CEO turnover increases with excess perk consumption by executives. The positive effect of excess perk consumption on CEO dismissal declines when the firms are momentum winners in market returns and profitability while it rises when firms are momentum losers. Non-co-opted independent directors amplify the positive effect of excess perks on forced CEO turnover whereas board gender diversity reduces such likelihood. Better educated CEOs appear to consume fewer excess perks, reducing the likelihood of forced turnover