IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v83y2025ics1544612325009547.html

Generalist CEOs and employee well-being: The moderating role of labor unions

Author

Listed:
  • Li, Weijiao
  • Gu, Zhihui

Abstract

Upper echelon theory proposes that CEO characteristics have profound implications for decision making and firm outcomes. In this study, we explore the impact of CEO background diversity on employee well-being. Taking advantage of publicly traded A-share enterprises in China between 2013 and 2023, we demonstrate that generalist CEOs lead to higher employee well-being than specialist CEOs. This positive impact of generalist CEOs is weakened when firms have effective labor unions. Further analysis suggests that employee welfare expenditures and employee turnover ratios are the possible economic mechanisms underlying the main relationship. Our findings are robust to multiple sensitivity and endogeneity tests.

Suggested Citation

  • Li, Weijiao & Gu, Zhihui, 2025. "Generalist CEOs and employee well-being: The moderating role of labor unions," Finance Research Letters, Elsevier, vol. 83(C).
    • Handle: RePEc:eee:finlet:v:83:y:2025:i:c:s1544612325009547
    DOI: 10.1016/j.frl.2025.107695
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325009547
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.107695?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Clive Boddy, 2014. "Corporate Psychopaths, Conflict, Employee Affective Well-Being and Counterproductive Work Behaviour," Journal of Business Ethics, Springer, vol. 121(1), pages 107-121, April.
    2. Sun, Zixiong & Anderson, Hamish & Chi, Jing, 2023. "Managerial foreign experience and corporate risk-taking: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 86(C).
    3. Muhammad Kabir & Harun Rashid, 2024. "Do generalist CEOs engage in more tax avoidance than specialist CEOs?," Accounting and Business Research, Taylor & Francis Journals, vol. 54(5), pages 525-551, July.
    4. Aabo, Tom & Rønnow, Sara Korsdal, 2024. "Female CEOs with a squeeze of narcissism: A perfect cocktail for corporate performance?," Finance Research Letters, Elsevier, vol. 64(C).
    5. Guoli Chen & Sterling Huang & Philipp Meyer‐Doyle & Denisa Mindruta, 2021. "Generalist versus specialist CEOs and acquisitions: Two‐sided matching and the impact of CEO characteristics on firm outcomes," Strategic Management Journal, Wiley Blackwell, vol. 42(6), pages 1184-1214, June.
    6. Xiaohong Fan & Sailu Li & Natalia Villatoro, 2021. "CEO gender and corporate labor cost," Review of Financial Economics, John Wiley & Sons, vol. 39(3), pages 360-380, July.
    7. Chatjuthamard, Pattanaporn & Jiraporn, Pornsit & Treepongkaruna, Sirimon, 2021. "How do independent directors view generalist vs. specialist CEOs? Evidence from an exogenous regulatory shock," International Review of Financial Analysis, Elsevier, vol. 78(C).
    8. Ertugrul, Mine & Marciukaityte, Dalia, 2021. "Labor unions and corporate social responsibility," Journal of Banking & Finance, Elsevier, vol. 125(C).
    9. Song, Jun Myung & Chung, Chune Young, 2023. "Female CEOs and investment efficiency in the Vietnamese market," Finance Research Letters, Elsevier, vol. 58(PA).
    10. Egor Evdokimov & Dean Hanlon & Edwin KiaYang Lim, 2022. "Do Generalist CEOs Magnify Boardroom Backscratching?," Journal of Business Ethics, Springer, vol. 181(1), pages 221-247, November.
    11. Frye, Melissa B. & Pham, Duong T., 2018. "CEO gender and corporate board structures," The Quarterly Review of Economics and Finance, Elsevier, vol. 69(C), pages 110-124.
    12. Xu, Yan & Xu, Nianhang & Chan, Kam C. & Li, Zhe, 2021. "Generalists vs. specialists: Who are better acquirers?," Journal of Corporate Finance, Elsevier, vol. 67(C).
    13. Krystyniak, Karolina & Staneva, Viktoriya, 2024. "Executive gender and capital structure: New evidence from rebalancing events," Finance Research Letters, Elsevier, vol. 65(C).
    14. Betzer, André & Lee, Hye Seung (Grace) & Limbach, Peter & Salas, Jesus M., 2020. "Are Generalists Beneficial to Corporate Shareholders? Evidence from Exogenous Executive Turnovers," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 55(2), pages 581-619, March.
    15. Faccio, Mara & Marchica, Maria-Teresa & Mura, Roberto, 2016. "CEO gender, corporate risk-taking, and the efficiency of capital allocation," Journal of Corporate Finance, Elsevier, vol. 39(C), pages 193-209.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Guo, Jintong & Ding, Rui & Zhang, Ziyi & Zhang, Min, 2025. "Top executives' emotional stability and firm risk-taking: A machine learning-based study," Pacific-Basin Finance Journal, Elsevier, vol. 90(C).
    2. Man Chen & Si Liu & Feng Wang & Rui Guo, 2024. "The dark side effects of CEO general managerial skills on corporate overinvestment," Asia Pacific Journal of Management, Springer, vol. 41(4), pages 2277-2300, December.
    3. Baghdadi, Ghasan A. & Safiullah, Md & Heyden, Mariano L.M., 2023. "Do gender diverse boards enhance managerial ability?," Journal of Corporate Finance, Elsevier, vol. 79(C).
    4. Aastha Mittal & Shveta Singh, 2025. "Does CEO gender impact dividends in emerging economies?," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 22(1), pages 165-176, March.
    5. Chen, Robin & Li, Shenru & Truong, Quang Thai & Chan, Chia-Ying, 2025. "Gender diversity in the boardroom: The role of female directors in mitigating stock price crash risk," Global Finance Journal, Elsevier, vol. 67(C).
    6. Sungchang Kang & Jeongseok Bang & Doojin Ryu, 2024. "Female CEOs’ risk management and earnings performance during the financial crisis," Asian Business & Management, Palgrave Macmillan, vol. 23(1), pages 110-138, February.
    7. Zhang, Tony Xiaochi & Molchanov, Alexander & Nguyen, Harvey & Pham, Mia Hang, 2025. "Leading safely: The impact of generalist CEOs on workplace safety," Journal of Behavioral and Experimental Finance, Elsevier, vol. 46(C).
    8. Bi, Rui & Tang, Zhisong, 2024. "Research on the impact of the 'Double Reduction' policy on the risk-taking of educational training enterprises," Finance Research Letters, Elsevier, vol. 62(PB).
    9. Qian Lu & Guoguang Wan & Liang Xu, 2025. "Generalist Versus Specialist CEOs and the Scope of Corporate Social Responsibility," Journal of Business Ethics, Springer, vol. 197(1), pages 143-158, February.
    10. Lan, Ge & Gao, Xin & Zheng, Xiaolan & Zhou, Hang & Li, Donghui, 2025. "Does short-selling threat potentially influence corporate risk-taking? Evidence from equity lending supply," International Review of Financial Analysis, Elsevier, vol. 97(C).
    11. Liu, Yin & Neely, Pamela & Karim, Khondkar, 2022. "The impact of CFO gender on corporate overinvestment," Advances in accounting, Elsevier, vol. 57(C).
    12. Sun, Liang, 2025. "CEO gender and cybersecurity: The role of female CEOs in mitigating data breach risks," International Journal of Accounting Information Systems, Elsevier, vol. 56(C).
    13. Irfan Ullah & Muhammad Ansar Majeed & Hong-Xing Fang & Muhammad Arif Khan, 2020. "Female CEOs and investment efficiency: evidence from an emerging economy," Pacific Accounting Review, Emerald Group Publishing Limited, vol. 32(4), pages 443-474, November.
    14. Chase Lee, Chaeho & Atukeren, Erdal & Kim, Hohyun, 2025. "Organizational capital and stock performance during Crises: Moderating role of generalist CEO," The North American Journal of Economics and Finance, Elsevier, vol. 75(PA).
    15. Kim, Yeongsu Anthony & Liang, Feng Helen, 2023. "The effect of CEO prominence on cross-border acquisitions: An international entrepreneurship approach," Journal of Business Research, Elsevier, vol. 163(C).
    16. Li, Gang & Ma, Yan, 2025. "Labor contract law, labor income share, and corporate risk-taking," Finance Research Letters, Elsevier, vol. 85(PC).
    17. Mundi, Hardeep Singh, 2022. "CEO social capital and capital structure complexity," Journal of Behavioral and Experimental Finance, Elsevier, vol. 35(C).
    18. Liu, Qi & Wu, Jiejie, 2023. "Strong financial regulation and corporate risk-taking: Evidence from a natural experiment in China," Finance Research Letters, Elsevier, vol. 54(C).
    19. Owen, Ann L. & Temesvary, Judit, 2018. "The performance effects of gender diversity on bank boards," Journal of Banking & Finance, Elsevier, vol. 90(C), pages 50-63.
    20. Jiang Cheng & Hung-Gay Fung & Tzu-Ting Lin & Min-Ming Wen, 2024. "CEO optimism and the use of credit default swaps: evidence from the US life insurance industry," Review of Quantitative Finance and Accounting, Springer, vol. 63(1), pages 169-194, July.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:83:y:2025:i:c:s1544612325009547. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.