This paper investigates under what circumstances boards of directors fire CEOs and whether this action leads to better firm performance. We use unique and detailed data, covering 473 companies in the transition region, on boards’ actions, expectations and beliefs about CEO ability. We find...

We test under what circumstances boards discipline managers and whether such interventions improve performance. We exploit exogenous variation due to the staggered adoption of corporate governance laws in formerly Communist countries coupled with detailed ‘hard’ information about the...

Most research on the CEO labor market has studied public company CEOs while largely ignoring the market for CEOs in private equity funded companies. We fill this gap by studying the market for CEOs among larger U.S. companies (enterprise value greater than $1 billion) purchased by private equity...

The literature posits that some CEO overconfidence benefits shareholders, though high levels may not. We argue adequate controls and independent viewpoints provided by an independent board mitigates the costs of CEO overconfidence. We use the concurrent passage of the Sarbanes-Oxley Act and...

We identify the power of institutional blockholders to influence management using previous occurrences of forced CEO turnover at other firms in the blockholders' overall portfolio. We create a “powerful blockholder linkage” measure that strongly predicts future forced CEO turnover. These...

Prior literature examines the matching of firm-types with board composition, but very little research focuses on the matching of CEO types with directors' skill sets. We examine whether a gender-diverse board helps to mitigate the negative impacts of overconfident managers, thus improving firm...

We show that managerial learning from stock prices can lead to feedback loop vulnerability: liquidity-induced trading can impose a negative externality on the firm's investment decisions, inducing liquidity unconstrained investors to sell their stock holdings. Interestingly, overconfident...

While boards are known to react to corporate misconduct by removing the executives responsible, little is known about whether the board's response is shaped by the firm's social context. Using the 2006 stock option backdating scandal, in which firms manipulated stock option grant dates, we...

While poor firm performance has been shown to be an important predictor of CEO dismissal, financial performance alone cannot explain the increased incidence of CEO dismissal. The complex and ambiguous relationship between poor firm performance and CEO dismissal is due in part to the uncertainty...

We examine the relation between institutional investors and management discipline over the last several decades to better understand how CEO turnover has increased. Using a sample of forced and voluntary turnovers, we investigate the changing roles of activism and exit among institutional...