Do CEOs Matter?

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Do CEOs Matter?

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dc.contributor.author Pérez-González, Francisco en_US
dc.contributor.author Wolfenzon, Daniel en_US
dc.contributor.author Bennedsen, Morten en_US
dc.date.accessioned 2009-02-04T10:27:38Z
dc.date.available 2009-02-04T10:27:38Z
dc.date.issued 2007-12-06T00:00:00Z en_US
dc.identifier.uri http://hdl.handle.net/10398/7523
dc.description.abstract Abstract. Estimating the value of top managerial talent is a central topic of research that has attracted widespread attention from academics and practitioners. Yet, testing for the importance of chief executive officers (CEOs) on firm outcomes is challenging. In this paper we test for the impact of CEOs on performance by assessing the effect of (1) CEO deaths and (2) the death of CEOs immediate family members (spouse, parents, children, etc), which arguably affects CEOs focus. Using a unique dataset from Denmark, we find that CEO (but not board members ) own and family deaths are strongly correlated with declines in firm operating profitability, investment and sales growth. Our CEO shock-outcome analysis allows us to identify the shocks that are the most (least) meaningful for CEOs: the death of children and spouses (mothers-in-law). We show that individual CEO, firm and industry characteristics seem to affect the impact of these shocks. In particular, CEO effects are larger (lower) for longer-tenured (older) CEOs and for those managers with large investment fixed effects. CEO shocks are relevant across the size distribution of firms but are concentrated on those firms that invested heavily in the past. Lastly, we find that CEO shocks tend to be larger in rapid growth, high investment and R&D intensive industries. Overall, our findings demonstrate managers are a key determinant of firm performance. en_US
dc.format.extent 40 s. en_US
dc.language eng en_US
dc.relation.ispartofseries Working paper;2007-13 en_US
dc.title Do CEOs Matter? en_US
dc.type wp en_US
dc.accessionstatus modt07dec06 nijemo en_US
dc.contributor.corporation Copenhagen Business School. CBS en_US
dc.contributor.department Økonomisk Institut en_US
dc.contributor.departmentshort ECON en_US
dc.contributor.departmentuk Department of Economics en_US
dc.contributor.departmentukshort ECON en_US
dc.idnumber x656555776 en_US
dc.publisher.city København en_US
dc.publisher.year 2007 en_US


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