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CEO Turnovers and Corporate Governance: Evidence from the Copenhagen Stock Exchange

Author

Listed:
  • Neumann, Robert

    (Department of Finance, Copenhagen Business School)

  • Voetmann, Torben

    (Department of Finance, Copenhagen Business School)

Abstract

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.

Suggested Citation

  • Neumann, Robert & Voetmann, Torben, 2001. "CEO Turnovers and Corporate Governance: Evidence from the Copenhagen Stock Exchange," Working Papers 1999-10, Copenhagen Business School, Department of Finance.
  • Handle: RePEc:hhs:cbsfin:1999_010
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    File URL: http://ir.lib.cbs.dk/download/ISBN/8790705254.pdf
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    Cited by:

    1. Lausten, Mette, 2002. "CEO turnover, firm performance and corporate governance: empirical evidence on Danish firms," International Journal of Industrial Organization, Elsevier, vol. 20(3), pages 391-414, March.

    More about this item

    Keywords

    CEO Turnovers; Corporate Governance; Ownership Structure;

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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