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Top Executive Dismissal, Ownership and Corporate Performance

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Top Executive Dismissal, Ownership and Corporate Performance. / Conyon, Martin; Florou, Annita.

In: Accounting and Business Research, Vol. 32, No. 4, 2002, p. 209-225.

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Conyon, Martin ; Florou, Annita. / Top Executive Dismissal, Ownership and Corporate Performance. In: Accounting and Business Research. 2002 ; Vol. 32, No. 4. pp. 209-225.

Bibtex

@article{abe57fa89401499dbce2124422312e0e,
title = "Top Executive Dismissal, Ownership and Corporate Performance",
abstract = "This paper evaluates the empirical relationship between top executive turnover and firm performance. Based on a sample of the 460 largest UK listed companies during the period 1990-1998 we establish an inverse and robust statistical relation between the probability of a management change and a firm's performance: top executives are fired for poor performance. This can result from internal monitoring of management by the board or block share holders. Second, the data indicate that only very poor levels of performance affect significantly the turnover likelihood: corporate performance must fall dramatically to force a senior executive job separation. Third, the likelihood of managerial turnover for poor performance has not changed over time: today's senior managers face the same disciplining effects as those senior managers in earlier years. Finally, there seems to be no evidence that managerial stock ownership, measured as the proportion of ordinary shares owned by top managers, enables them to become entrenched.",
author = "Martin Conyon and Annita Florou",
year = "2002",
doi = "10.1080/00014788.2002.9728971",
language = "English",
volume = "32",
pages = "209--225",
journal = "Accounting and Business Research",
issn = "0001-4788",
publisher = "Routledge",
number = "4",

}

RIS

TY - JOUR

T1 - Top Executive Dismissal, Ownership and Corporate Performance

AU - Conyon, Martin

AU - Florou, Annita

PY - 2002

Y1 - 2002

N2 - This paper evaluates the empirical relationship between top executive turnover and firm performance. Based on a sample of the 460 largest UK listed companies during the period 1990-1998 we establish an inverse and robust statistical relation between the probability of a management change and a firm's performance: top executives are fired for poor performance. This can result from internal monitoring of management by the board or block share holders. Second, the data indicate that only very poor levels of performance affect significantly the turnover likelihood: corporate performance must fall dramatically to force a senior executive job separation. Third, the likelihood of managerial turnover for poor performance has not changed over time: today's senior managers face the same disciplining effects as those senior managers in earlier years. Finally, there seems to be no evidence that managerial stock ownership, measured as the proportion of ordinary shares owned by top managers, enables them to become entrenched.

AB - This paper evaluates the empirical relationship between top executive turnover and firm performance. Based on a sample of the 460 largest UK listed companies during the period 1990-1998 we establish an inverse and robust statistical relation between the probability of a management change and a firm's performance: top executives are fired for poor performance. This can result from internal monitoring of management by the board or block share holders. Second, the data indicate that only very poor levels of performance affect significantly the turnover likelihood: corporate performance must fall dramatically to force a senior executive job separation. Third, the likelihood of managerial turnover for poor performance has not changed over time: today's senior managers face the same disciplining effects as those senior managers in earlier years. Finally, there seems to be no evidence that managerial stock ownership, measured as the proportion of ordinary shares owned by top managers, enables them to become entrenched.

U2 - 10.1080/00014788.2002.9728971

DO - 10.1080/00014788.2002.9728971

M3 - Journal article

VL - 32

SP - 209

EP - 225

JO - Accounting and Business Research

JF - Accounting and Business Research

SN - 0001-4788

IS - 4

ER -