Monitoring Managers: Does It Matter?

• 成果类型: Article
• 署名作者: Cornelli, Francesca; Kominek, Zbigniew; Ljungqvist, Alexander
• 署名单位: University of London; London Business School; New York University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.12004
• 发表日期: 2013
• 页码: 431-481
• 关键词: instrumental variables; executive-compensation; firm performance; INVESTMENT; turnover; DIRECTORS

摘要

We study how well-incentivized boards monitor CEOs and whether monitoring improves performance. Using unique, detailed data on boards' information sets and decisions for a large sample of private equitybacked firms, we find that gathering information helps boards learn about CEO ability. Soft information plays a much larger role than hard data, such as the performance metrics that prior literature focuses on, and helps avoid firing a CEO for bad luck or in response to adverse external shocks. We show that governance reforms increase the effectiveness of board monitoring and establish a causal link between forced CEO turnover and performance improvements.