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New CEO origin and firm performance: Moderating effects of CEO similarity and career experience
Type
conference paper
Date Issued
2013-08-09
Author(s)
Abstract
This paper seeks a better understanding of the performance implication of CEO succession origin. Drawing on relational demography and information processing theories, we propose that the benefits of outside succession are more likely to outweigh the costs when the outsider CEO: a) is socio-demographically similar to other executive team members and b) has acquired diverse experience from various countries and functional areas throughout his or her career. Data from 97 CEO succession events at large European corporations over a five years period (i.e. 2005 to 2009) show that both socio-demographic similarity and intra-personal career experience diversity of newly appointed CEOs act as optimizing factors that reduce the costs and increase the benefits of outside CEO succession. More generally, our research suggests that the performance effects of CEO succession origin should not be considered in isolation, but in interaction with other individual level attributes of newly appointed CEOs.
Language
English
Keywords
CEO succession
TMT
career experience
demographic similarity
HSG Classification
contribution to scientific community
Refereed
No
Book title
Capitalism in Question
Publisher
Academy of Management
Publisher place
New York
Start page
36
Event Title
73rd Academy of Management Annual Meeting (AOM) 2013 "Capitalism in Question"
Event Location
Orlando, FL
Event Date
09.-13.08.2013
Subject(s)
Eprints ID
225371