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Shareholder wealth effects of CEO departures: evidence from the UK

Dedman, Elisabeth and Lin, Stephen W.-J (2002) Shareholder wealth effects of CEO departures: evidence from the UK Journal of Corporate Finance, 8 (1). pp. 81-104.

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Abstract

This paper examines share price behaviour surrounding announcements of CEO departures from UK firms listed on the All Share Index between 1990 and 1995. We find that many firms choose not to announce CEO departures, and that these firms have poorer performance records, and higher chances of future failure, than those firms who officially announce CEO turnover to the London Stock Exchange. The market reacts negatively to announcements of top executive departures, especially when the CEO is dismissed or leaves to take up another job. Share price reactions to the disclosure of top executive departure are significantly affected by the financial risk of the firm and whether the board announces a replacement CEO.

Item Type: Article
Divisions : Faculty of Arts and Social Sciences > Surrey Business School
Authors :
NameEmailORCID
Dedman, Elisabethe.dedman@surrey.ac.uk
Lin, Stephen W.-J
Date : January 2002
DOI : 10.1016/S0929-1199(01)00027-X
Uncontrolled Keywords : Corporate governance; Managerial departure; Board structure
Depositing User : Clive Harris
Date Deposited : 01 Jul 2019 13:27
Last Modified : 01 Jul 2019 13:27
URI: http://epubs.surrey.ac.uk/id/eprint/852193

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