Abstract
The financial crunch of 2008/9 occasioning the collapse of companies and financial institutions worldwide, sparked calls for transparency and accountability in the dealings of corporate bodies. It engendered more interests on issues concerning corporate governance among researchers, academicians and practitioners. It is worth noting that Chief Executive Officers (CEOs) are usually appointed and entrusted with the responsibility of managing corporate affairs on behalf of shareholders. Dual interests consequently emerge following the appointment of a CEO comprising the interest of shareholders and that of the CEO with a probability that the self-interests of CEO might run counter to the general interest of shareholders. As a result, many firms are actively incorporating into their corporate governance provisions, strategies to control executives’ performance. A strategic tool used in influencing the performance of chief executives towards the desired goals of an organisation is performance appraisal, yet there is little consideration for executive appraisal in the academic literature. This study seeks to complement the dearth of scholarly conversation on executive appraisal using a qualitative single case study approach drawing on an interview with a Chief Executive Officer of an international bank based in New Zealand. Employing stakeholder theory as a theoretical lens, the findings suggest that appraising CEOs can be instrumental in building good relationships, sustain organisation’s performance and enhance their career advancement.
Highlights
It is worth noting that Chief Executive Officers (CEOs) are usually appointed and entrusted with the responsibility of managing corporate affairs on behalf of shareholders
This study seeks to complement the dearth of scholarly conversation on executive appraisal using a qualitative single case study approach drawing on an interview with a Chief Executive Officer of an international bank based in New Zealand
The research findings suggest that executive appraisal is an important part of the corporate governance process and provide a board with the crucial indicators of a CEO’s characteristics and quality
Summary
“evaluate and improve continuously individual, subsidiary unit and corporate performance against clearly defined, pre-set objectives” [1]. Organisations are more likely to evaluate employee performance based on corporate goals and standards [2]. It is on the basis of PM that organisational resources are distributed to business units and individuals. Performance Management is instrumental for career planning and development [3] [4] since individual weaknesses and shortcomings are brought to light in the course of their work performance. Organisations are able to draw up corrective action plans to help bridge individual performance gaps. The fundamental purpose of PM is to ensure that employees act in accordance with corporate interests [1] [5] [6]
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