Kavadis, N, Heyden, MLM and Sidhu, J orcid.org/0000-0001-9773-7559 (2022) Fresh in the saddle: The influence of a new CEO's vision and origin, and CEO succession type on market actors' reactions. Long Range Planning, 55 (2). 102050. ISSN 0024-6301
Abstract
CEO succession is a critical event in the life of a company. How external stakeholders respond to it, can affect the company's valuation. This study investigates how securities analysts' and investors' reactions to CEO succession are affected by the interplay between the charisma of the new CEO's vision, the new CEO's origin (whether an insider or outsider), and the type of CEO succession (whether routine, dismissal or interim). Drawing on the literature on signaling, we suggest that because a charismatic vision emits a positive signal about the company's future performance, it will affect market actors' reactions by either weakening or strengthening the influence of the signals emitted by other succession context contingencies, namely, CEO origin and succession type. To test our predictions regarding analysts' and investors' reactions, we respectively analyze panel data and conduct an event study. The results support most of our predictions. We discuss the study's contributions and implications.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2020, Elsevier. All rights reserved. This is an author produced version of an article published in Long Range Planning. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | CEO succession; CEO origin; charismatic vision; market performance; signaling theory |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Management Division (LUBS) (Leeds) > Management Division Strategy and Organisation (LUBS) |
Depositing User: | Symplectic Publications |
Date Deposited: | 19 Nov 2020 15:34 |
Last Modified: | 03 Nov 2022 01:13 |
Status: | Published |
Publisher: | Elsevier |
Identification Number: | 10.1016/j.lrp.2020.102050 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:168104 |