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Journal of Management and Governance

Erschienen in:

20.06.2017

CEO characteristics and firm valuation: a quantile regression analysis

verfasst von: Pascal Nguyen, Nahid Rahman, Ruoyun Zhao

Erschienen in: Journal of Management and Governance | Ausgabe 1/2018

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Abstract

This study investigates the effects of three highly-visible CEO characteristics on firm valuation. Using a sample of 2702 observations for Australian firms over the period 2001–2011, we find that CEO age is uniformly associated with lower firm valuation. CEO tenure is also associated with lower valuation, but more significantly so in the higher quantiles of firm valuation, that is for firms with high-growth opportunities. In contrast, CEO duality is found to be beneficial only for firms with high-growth opportunities. Overall, the study highlights the contingent relationship between CEO characteristics and firm valuation.

Vorheriger Artikel Corporate divestiture and performance: an institutional view

Nächster Artikel Does the capital of social capital matter? Relational resources of the board and the performance of Brazilian companies

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In the US, the board chair and the CEO roles are often combined in large listed firms (Linck et al. 2008). In contrast, CEO duality is not very common in large listed companies in Australia (Monem 2013).

The US evidence on the effect of CEO duality is inconclusive: Bhagat and Bolton (2008) report that duality is negatively correlated with firm performance, whereas Peni (2014) finds a positive relationship.

Since this variable is relatively well-behaved, we do not apply the logarithmic transformation that some authors have been forced to use in the presence of high positive skewness (e.g., Coles et al. 2008).

See “Aussie chiefs find it tough, and brief, at top”, The Australian Business Review, 16 October 2013.

We leave this variable unchanged. Using the natural log of Board ownership does not qualitatively affect our results.

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Titel: CEO characteristics and firm valuation: a quantile regression analysis
verfasst von: Pascal Nguyen
Nahid Rahman
Ruoyun Zhao
Publikationsdatum: 20.06.2017
Verlag: Springer US
Erschienen in: Journal of Management and Governance / Ausgabe 1/2018
Print ISSN: 1385-3457
Elektronische ISSN: 1572-963X
DOI: https://doi.org/10.1007/s10997-017-9383-7

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