CEO Turnover and Corporate Performance Relationship in Pre- and Post-IFRS Period: Evidence from Turkey
Journal of Business Economics and Management, Volume 13, Issue 3, 2012
Posted: 23 Jun 2011 Last revised: 2 Aug 2012
Date Written: May 25, 2011
Abstract
This study investigates CEO turnover and corporate performance relationship as a measure of the effectiveness of a corporate governance system. The impact of different financial accounting regimes on the turnover/performance relationship is also analyzed. If systems replace poorly performing managers, they are considered as not ineffective. The results provide evidence that corporate governance systems with poor governance characteristics may not be ineffective, due to the existence of alternative governance mechanisms. The disciplinary CEO turnover is found to be more strongly associated with corporate performance compared to voluntary CEO turnover, whereas in the IFRS sub-sample the relationship is stronger with contemporaneous performance measures.
Keywords: CEO turnover, corporate governance, corporate performance, IFRS, Turkey, effectiveness
JEL Classification: M41, M44, M47
Suggested Citation: Suggested Citation