CEO Turnovers and Corporate Governance: Evidence from the Copenhagen Stock Exchange
This paper examines the relationship between performance and CEO turnovers using a sample of 81 turnovers and 81 matching companies listed on the Copenhagen Stock Exchange. We find that poor performance increases the probability of management replacements and that forced layoffs are value-increasing events while voluntary resignations are value-decreasing events. Institutional investors as active monitors, or part of corporate control, are not exhibited in the analysis of CEO turnovers. If institutional investors have any influence on CEO turnovers, then it is not revealed in our data. But, the results suggest that institutional investors' equity holdings tend to protect managers from replacement.
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