Explaining top management turnover in private corporations: The role of cross-country legal institutions and capital market forces

• 成果类型: Article
• 署名作者: Lel, Ugur; Miller, Darius; Reisel, Natalia
• 署名单位: University System of Georgia; University of Georgia; Southern Methodist University; Fordham University
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-019-00217-9
• 发表日期: 2019
• 页码: 720-739
• 关键词: CORPORATE GOVERNANCE; international investor protection; Ownership structure; Agency theory

摘要

We investigate private firms' ability to identify and replace poorly performing managers across countries. We document three main findings. First, private firms are more likely to retain poorly performing managers in countries where legal institutions that protect minority investors are weak. Second, private firms are more likely to retain poorly performing managers than public firms only in countries where governance mechanisms inherent in public equity markets limit managerial entrenchment in public firms. Third, private firm managers are less likely to be replaced even when poor performance continues for relatively long horizons. Overall, our findings provide new evidence on the potential vulnerability of minority shareholders in private firms.