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Fired or Retired? A Competing Risks Analysis of Chief Executive Turnover


  • Ian Gregory-Smith
  • Steve Thompson
  • PeterW. Wright


We apply duration analysis to model the tenure and mode of exit of CEOs from FTSE 350 companies from 1996-2005, a decade in which corporate governance reforms have sought to increase the accountability of the CEO to shareholders and their representatives on the board. We find a greater likelihood of dismissal in the latter part of the period. However, we also find that the likelihood of forced departure sharply decreases from the fifth year of a CEO's tenure. We find evidence that this is because CEOs who survive beyond year four are able to entrench themselves in their position. Copyright © The Author(s). Journal compilation © Royal Economic Society 2009.

Suggested Citation

  • Ian Gregory-Smith & Steve Thompson & PeterW. Wright, 2009. "Fired or Retired? A Competing Risks Analysis of Chief Executive Turnover," Economic Journal, Royal Economic Society, vol. 119(536), pages 463-481, March.
  • Handle: RePEc:ecj:econjl:v:119:y:2009:i:536:p:463-481

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    Cited by:

    1. Buchwald, Achim & Hottenrott, Hanna, 2015. "Women on the board and executive duration: Evidence for European listed firms," ZEW Discussion Papers 15-016, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    2. Xunan Feng & Anders C. Johansson, 2017. "CEO Incentives in Chinese State-Controlled Firms," Economic Development and Cultural Change, University of Chicago Press, vol. 65(2), pages 223-264.
    3. repec:eee:corfin:v:48:y:2018:i:c:p:76-93 is not listed on IDEAS
    4. Swarnodeep Homroy & Shantanu Banerjee, 2015. "The Structure of Corporate Holdings and Corporate Governance: Evidence from India," Working Papers 84979625, Lancaster University Management School, Economics Department.
    5. Brian Bell & Simone Pedemonte & John Van Reenen, 2016. "CEO Pay and the Rise of Relative Performance Contracts: A Question of Governance?," CEP Discussion Papers dp1439, Centre for Economic Performance, LSE.
    6. Grzenda Wioletta & Buczyński Michał K., 2015. "Estimation of Employee Turnover with Competing Risks Models," Folia Oeconomica Stetinensia, Sciendo, vol. 15(2), pages 53-65, December.
    7. repec:eee:corfin:v:48:y:2018:i:c:p:314-330 is not listed on IDEAS
    8. Swarnodeep HomRoy, 2016. "Was Adam Smith Right? Evidence of Compensating Differential in CEO Pay," Manchester School, University of Manchester, vol. 84(1), pages 1-24, January.
    9. Yudan Zheng, 2010. "The effect of CEO tenure on CEO compensation: Evidence from inside CEOs vs outside CEOs," Managerial Finance, Emerald Group Publishing, vol. 36(10), pages 832-859, August.
    10. repec:eee:eecrev:v:102:y:2018:i:c:p:19-38 is not listed on IDEAS
    11. Balsmeier, Benjamin & Buchwald, Achim & Peters, Heiko, 2011. "Outside board memberships of CEOs: Expertise or entrenchment?," DICE Discussion Papers 26, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    12. Xavier Hollandts & Nicolas Aubert & Abdelmehdi Abdelhamid & Victor Prieur, 2017. "Beyond Dichotomy: The Curvilinear Impact of Employee Ownership on CEO entrenchment," Post-Print halshs-01495427, HAL.
    13. repec:eee:jaecon:v:64:y:2017:i:1:p:37-55 is not listed on IDEAS
    14. Xavier Hollandts & Nicolas Aubert & Abdelmehdi Abdelhamid & Victor Prieur, 2017. "Beyond Dichotomy: The Curvilinear Impact of Employee Ownership on CEO entrenchment," Working Papers halshs-01495427, HAL.
    15. Brian Bell & John Van Reenen, 2011. "Firm Performance and Wages: Evidence from Across the Corporate Hierarchy," CEP Discussion Papers dp1088, Centre for Economic Performance, LSE.
    16. Yim, Soojin, 2013. "The acquisitiveness of youth: CEO age and acquisition behavior," Journal of Financial Economics, Elsevier, vol. 108(1), pages 250-273.

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