CEO Characteristics Research Articles

Synergy of Work Environment, CEO Characteristics, and MSME Performance: A Case Study in Indonesia’s Clothing Industry

This research investigates the synergistic impact of the work environment and CEO characteristics on the performance of Micro, Small, and Medium Enterprises (MSMEs) in Indonesia's clothing industry. The study explores the significance of these factors in enhancing MSME performance and aims to contribute both theoretically and practically to the understanding of these dynamics. Utilizing a quantitative research approach, the study analyzes data from 276 MSMEs in the clothing industry, employing the Partial Least Squares Structural Equation Modeling (PLS-SEM) method. The results indicate a positive and significant influence of the work environment and CEO characteristics on MSME performance. The research provides valuable insights for policymakers, business leaders, and industry associations to optimize work environments and select CEOs with specific attributes to improve MSME performance.

Technology Adaptation and CEO Characteristics: Enhancing Competitive Advantage in Indonesia’s MSME of F&B in the Jabodetabek Region

The food and beverage (F&B) industry significantly impacts Indonesia's economy, playing a crucial role in economic growth and welfare. Micro, small, and medium-sized enterprises (MSMEs) in the F&B sector, particularly in the Jabodetabek region, are essential contributors to Indonesia's global standing. This study explores the relationship between technology adaptation, CEO characteristics, and competitive advantage in Jabodetabek's F&B MSMEs. Challenges faced by these enterprises, such as limited resources and human capital, underscore the need for effective technology adoption and strong leadership. The research aims to enrich the literature on this subject and provide insights for policymakers to enhance MSME competitiveness.

Research on corporate financialization and green innovation: moderating role of CEO’s individual characteristics

PurposeThis paper aims to explore the impact of corporate financialization (CF) on green innovation (GI) and further disclose the moderating role of CEO’s individual characteristics in such relationship from the perspective of corporate governance.Design/methodology/approachThis paper uses empirical research methods to study the impact of CF on GI based on the evidence from China capital market.FindingsThe findings indicate that: CF has a significant inhibiting effect on GI; female CEOs weaken the inhibiting effect of CF on GI compared to male CEOs; and CEO’s financial background positively moderates the inhibiting effect of CF on GI.Originality/valueThis paper, first, supplements the research literature on the economic consequences of CF and influencing factors of GI in non-financial firms. Then, it opens up the internal impact mechanism of CF on GI, which is moderated by the individual characteristics of corporate CEOs. Finally, it provides important reference for how to suppress CF of non-financial firms, cultivate CEOs that meet the needs of corporate development and promote GI development of enterprises through empirical evidence from China.

The impact of CEO attributes on sustainability performance: evidence from an emerging economy

PurposeThis study aims to empirically examine the influence of CEO characteristics on the sustainability performance of listed banks in Bangladesh through the lens of upper echelons theory.Design/methodology/approachThe authors estimated sustainability performance score based on a hand collected data set from the annual report and sustainability reports of the Bangladeshi listed banks. Following Clarkson et al. (2008), the sustainability index developed by Ong et al. (2016) and the G4 sustainability reporting standards of the global reporting initiative (GRI), a unique scoring index was developed to gather and assess sustainability data from listed banks. A panel regression analysis model is used to investigate the impact of CEO attributes on sustainability performance.FindingsThe findings of this study reveal that higher academic qualifications, greater industry experience and a longer tenure of the CEO have a significant and positive impact on the sustainable performance of the Bangladeshi listed banks. Furthermore, this study reveals that Bangladeshi listed banks are considerably behind in implementing the sustainability recommendations of Bangladesh Bank.Originality/valueThis study provides new evidence of how CEOs’ attributes can affect the sustainability reporting of Bangladeshi listed banks. Furthermore, this study measures the real contribution towards sustainability performance compared with the general claims about sustainability made by listed banks in Bangladesh.

Efek Moderasi Karakteristik Ceo Perusahaan Mendunia Pada Hubungan Kualitas Informasi Akuntansi Dan Nilai Perusahaan

Purpose: This study aims to examine whether CEO characteristics strengthen the effect of financial statement information quality on the firm value of well-known global companies. Methodology/approach: The sample is 366 well-known globally non-financial companies listed on the Asia Pacific Stock Exchange in 2019-2021. The sample was selected using a purposive sampling technique with criteria that companies’ annual and financial reports can be freely accessed. The analysis technique used is panel data regression analysis. Findings: The results show that the timeliness of financial reports and timely loss recognition significantly affect firm value. However, the effect of earnings management on firm value is not significant. Furthermore, CEO tenure, CEO gender, and CEO accounting education affect firm value significantly. This study contributes to the literature regarding the moderating effect of CEO characteristics in strengthening the effect of accounting information quality on firm value. Then it provides a view of the crucial effect of CEO characteristics in strengthening the impact of accounting information quality on a company's value. Practical Implication: Companies must pay attention to the financial report information and CEO characteristics such as CEO tenure, CEO gender, and CEO educational background in order to increase company value. Originality/value: This research is the first that examines the moderating effect of CEO characteristics on the impact of accounting information quality on the firm value of well-known global companies on the Asia Pacific Stock Exchange

CEO-director ties and board gender diversity: US evidence

The gender legislation enacted around the world has put enormous pressure on companies to increase the number of women on their boards. Employing US firm-specific data, we document a significant negative relationship between CEO-director ties and female representation on the board, suggesting that socially connected directors are detrimental to gender parity in senior management. We find that the situation improves in firms with female directors with valuable attributes while being moderated by CEO characteristics. Cross-sectional analyses reveal that the association is more pronounced during the low board gender diversity periods and for firms that are led by male CEOs or have weak monitoring mechanism. We rule out endogeneity concerns by performing a battery of analyses. The findings remain robust in a range of sensitivity tests. Our study offers practical implications for regulators and top management teams to improve board effectiveness, thus engendering lasting transformational change in the boardroom.

Examining the Influence of CEO Characteristics and Brand Image on Performance of Food and Beverages MSMEs in Indonesia: The Mediating Role of Competitive Advantage

Delve into the dynamic world of micro, small, and medium-sized enterprises (MSMEs) within Indonesia's vibrant food and beverages industry. This captivating study goes beyond the surface, exploring the intricate relationships that shape these businesses. We zero in on the captivating influence of CEO characteristics and the magnetic power of brand image. Unravel the mystery of how competitive advantage, like a skilled mediator, intertwines these factors, driving performance to new heights. Armed with data from a comprehensive survey of 210 respondents, our quantitative analysis paints a vivid picture. Brace yourself for the revelation: CEO Characteristics and Brand Image are not just players; they are the star performers, significantly impacting the dazzling world of Food and Beverages MSMEs. And there's more—Competitive Advantage takes center stage, weaving the threads of CEO Characteristics and Brand Image into a tapestry of success. As with any compelling narrative, this research isn't without its limitations. However, it sparks the flames of curiosity, paving the way for future explorations to unravel the deeper layers of this captivating story.

How does CEO green experience affect green innovation of energy firms? Evidence from China

CEO characteristics influence their strategic preferences, which are crucial for promoting corporate green innovation (GI). However, the influence and its mechanisms of CEO green experience (GreCEO) on GI of energy firms, especially when comparing different firm types holistically, remain understudied. This study used a moderated mediation model with fixed effects to examine the relationship between GreCEO and GI of energy firms, based on the unbalanced panel data of 821 listed Chinese energy firms during 2004–2021. We find that: (1) GreCEO positively affects energy firms’ GI. (2) Heterogeneity exists in the GI effect of GreCEO regarding business ownership and industry characteristics, and this effect is more prominent in non-state-owned energy firms and high-tech energy firms. (3) Green management (GM) and debt-to-asset ratio (DAR) partially mediate GreCEO's impact on GI of energy firms. (4) Renewable energy policy (REP) moderates the relationship between GreCEO and GI of energy firms, and its influencing mechanisms. In contrast to studies that focus on the direct effect of CEO characteristics on GI, this study identifies the potential influencing mechanisms through which GreCEO affects GI of energy firms. In addition, the moderation analysis reveals the boundary condition that GreCEO affects GI, enriching our understanding of GreCEO's effect on GI from the perspective of a firm's internal conditions and external policy environment. Regarding green development, CEOs’ early experience should be included in the management system and evaluation criteria of energy firms. The Chinese government should continue to implement the REP and accelerate energy firms’ green transition.

Birth Order and Executive Risk-Taking: A Study on CEO Behavioral Disposition

This paper explores the potential influence of chief executive officers’ (CEOs’) birth order on corporate decision-making. Drawing upon both theoretical frameworks and existing empirical studies, birth order considerably impacts individual personality attributes and risk aversion tendencies. Our analyses reveal a pronounced positive association between CEO’s birth order and their propensity for risk-taking. Specifically, CEOs born later in their familial succession are more inclined to risk-taking than their first-born counterparts, who are more conservative. These findings persist after controlling for CEO characteristics, year, and industry-specific factors. Moreover, further analyses were conducted to mitigate potential selection biases in companies choosing CEOs with specific risk preferences.

Determinants of environmental, social, and governance disclosure: A systematic literature review

AbstractThe popularity of environmental, social, and governance (ESG) investing or socially responsible investing is pushing private sectors to improve their ESG performance. Stakeholders, namely, investors, are relying on firms' environmental, social, and governance disclosures (ESGD) to evaluate their ESG performance and strategize their investment decision‐making. Since firms have substantial discretionary power in deciding the quantity and quality of ESGD, understanding the drivers and motivations of ESGD is paramount. This study examines the literature on the determinants of ESGD, and 36 articles published in a period spanning from 2006 to 2022 were analyzed and synthesized via a systematic literature review approach. Ninety‐one researchers from 30 countries contributed to these studies. Of these studies, 28% perform cross‐country investigations. This study found that although there is no single underpinning theory for ESGD, ESGD determinant studies are well supported by multiple theoretical frameworks, such as stakeholder theory, legitimacy theory, and institutional theory. This study reveals many factors that have an impact on ESGD, such as natural disasters, political and legal systems, ownership structure, board characteristics, and the CEO's characteristics. This study contributed to the burgeon of literature on ESG by offering valuable insights into the antecedents to ESG performance and facilitating future enhancements of a better ESGD framework. Lastly, this study also reveals future research directions for scholars to enrich the burgeoning literature in ESG.

Does the age of compensation committee members matter for CEO compensation?

AbstractResearch Question/IssueWe examine the impact of the age of compensation committee (CC) members on CEO compensation. Sociological theory suggests that age is a significant demographic factor influencing behavior. We argue that monitoring intensity increases with age because older directors are more likely to commit to their fiduciary duties.Research Findings/InsightsUsing FTSE 350 firms for the period 2002 to 2017, we find that CC members' age is negatively associated with the level of CEO pay but positively associated with pay–performance sensitivity after controlling for risk aversion attitude, experience in board monitoring, knowledge of the firm, and other firm and CEO characteristics. The relationships remain robust to alternative measures for age and compensation, using two‐stage least squares and high‐dimensional fixed effects models. Consistent with the view that older individuals tend to hold higher ethical standards and concomitant closer monitoring, we find that age effects are sensitive to the influence of ethical factors and are strongest for those firms for which intense monitoring is most needed. This suggests that age operates via older directors carrying out their roles more assiduously. We further show that our findings are less likely to be driven by director reputational effects, and the relationship between CC member age and CEO compensation persists even when we control for multiple dimensions of culturally inherited attributes of the CC members.Theoretical/Academic ImplicationsDespite the large literature on the influence of demographic characteristics on corporate governance, this study is the first on the monitoring effect of CC members' age. It contributes to the literature on the influence of demographic characteristic. It also contributes to the literature on CEO compensation by identifying a demographic factor—age—as a determinant of CEO pay, after controlling for the economic and corporate governance variables of the firm.Practitioner/Policy ImplicationsThis study highlights the role of demographic factors in explaining the monitoring of the CEO compensation contracting process and provides timely evidence on the recent regulatory changes.

CEO power and Characteristics on firm performance in Indonesian state-owned enterprises

Financial performance is an important indicator in a company in measuring the level of viability of the company. This study aims to analyze the effect of CEO power (proxied by CEO ownership), and characteristics (CEO educational background and work experience) on firm performance as proxied by ROA with the moderating variable of the percentage of the number of independent commissioners. The population in this study were all companies officially listed on the Indonesia Stock Exchange in 2015-2019. Then the sampling system used purposive sampling and obtained 16 state-owned companies listed on the Indonesia Stock Exchange. The results show that in model 1, CEO ownership variable has no effect on company performance, while the educational background variable has a significant negative effect and work experience variable has a significant positive effect on firm performance. In model 2, only the educational background variable has a significant effect, and the moderating variable does not strengthen the relationship between all independent variables on the company's financial performance.

Moderating Effect of Independent Directors on the Relationship between Chief Executive Officers Characteristics and Performance of Listed Deposit Money Banks in Nigeria

The study examined the moderating effect of independent directors on the relationship between Chief Executive Officers characteristics and performance of listed deposit money banks in Nigeria. Ex-post facto research design was used and panel data was collected from the audited annual financial statements of thirteen listed DMBs in Nigeria for a period of 2014-2022. Generalized Least Squares (GLS) method of Panel Regression, Fixed and Random Effects was employed in its estimations with the aid of STATA Software Version 14. Performance is dependent variable proxied by Return on Assets and Tobin’s Q, the independent variable is CEO characteristics proxied by CEO tenure, CEO gender, CEO age, CEO educational level, CEO financial expertise, CEO duality, CEO political connection and CEO ownership, the moderating variable is independent directors while board size and bank size are the control variables. The study found that CET, CEG, CEE, CFE, CPC, IDD and CEO have significant positive effect on banks performance, CEA has significant negative effect on banks performance while CED has non-significant positive effect on performance of listed DMBs in Nigeria. Also, the study found that independent directors did not only have a positive and significant direct effect on bank performance, but it also moderates the relationship between CEO characteristics and DMBs performance. However, the study recommends that Central Bank of Nigeria should make it mandatory for DMBs in Nigeria to have a board majorly composed of independent directors since their presence on board strengthens the relationship between CEO characteristics and banks performance.

Strategic divestment of emerging market firms: the influence of returnee managers and CEO characteristics

PurposeThis study aims to examine the role of returnee managers that can affect the strategic-divestment decision of emerging-market firms (EM firms). Drawing on arguments from the upper echelons theory and international human resource mobility perspectives, this study aims to propose that returnee managers influence corporate divestitures when the business outlook is negative. In addition, this study aims to examine the interplay between returnee managers and CEOs, whose characteristics can foster or undermine the efforts of returnee managers to engage in corporate divestments.Design/methodology/approachThis study examines 278 firms from nine emerging economies. The negative binomial regression was employed to estimate the model. In the robustness checks, the logistic regression was adopted to confirm the earlier findings.FindingsThe empirical results support the notion that returnee managers strengthen the relationship between firm performance and divestments. Because of the limited liabilities of foreignness and outsidership, returnee managers can gain social trust and credibility through communication and social interaction. Furthermore, the results provide mixed support for the moderating effect of CEO characteristics on the performance–divestment relationship.Practical implicationsThis study reveals that returnee managers are a great asset for EM firms that aim to find synergies and upgrade their capabilities through asset reconfiguration, which is an essential activity of emerging market firms to integrate themselves into the global competition. Meanwhile, CEO characteristics can foster (through their education level) or hinder (due to their age) divestment attempts, influenced by returnee managers.Originality/valueThis study explores an understudied phenomenon in international business (IB): strategic divestment of EM firms. The literature that examines strategic divestment and corporate refocusing in emerging markets is extremely limited. Furthermore, this study explores the novel topic that intersects the international business (IB) and international human resource management (IHRM) research areas. Specifically, this study investigates the impact of returnee managers on strategic divestments.

Do CEO characteristics impact corporate cash holdings? Insights from consumer goods companies listed on the Indonesia Stock Exchange

This study aims to determine the effects of CEO characteristics on the corporate cash holdings of consumer goods industry firms listed on the Indonesia Stock Exchange from 2017–2021. The data used in this study were taken from annual reports of firms in consumer goods industry sectors published by the Indonesia Stock Exchange from 2017–2021. This study utilized a purposive sampling technique to obtain 210 observations. The research model used is an unbalanced panel data analysis with a fixed-effect model approach. The results show that gender diversity, CEO age and CEO education have positively associated with corporate cash holdings. However, CEO tenure has no a significant effect with corporate cash holdings

CEO education and corporate social performance: moderation effects of CEO characteristics and firm's governance quality

PurposeThe authors examine if CEO education level and quality impacts firm's corporate social performance (CSP). Additionally, the authors investigate whether other CEO characteristics such as age, busyness, compensation and firm's governance quality moderate the relationship between CEO education and CSP.Design/methodology/approachThe authors use panel regression framework amid set of controls for their analysis. The authors additionally use two-stage least squares regression (2SLS) for robustness tests.FindingsThe authors show that CEOs with a post-graduate business degree (PGBUS) impact firm's CSP positively, whereas other educational degree directly do not influence CSP. However, CEO's age, busyness, compensation and firm's governance quality are found negatively moderating such relationship. The results survive set of robustness tests, and results are consistent the roles of upper echelons in Indian firms' strategic behaviors.Originality/valueThe results seek for an integration of more ethics and social responsibility discussions in the different education levels including undergraduate degree in India to help engender a stronger sense of moral consciousness toward firms' stakeholders as the Indian economy continues to develop.

Looking at the darker side of the mirror: the impact of CEO's narcissism on corporate social irresponsibility

PurposeThe aim of this article is to highlight the major part played by executives in the escalation of corporate social irresponsibility (CSI). Based on the upper echelons theory, the authors developed a model which shows the essential role of CEOs in explaining CSI. The authors proposed that the key personality traits of CEOs—narcissism—, as well as their power, could explain the degree of CSI.Design/methodology/approachDue to the significant methodological challenges when investigating CSI, the authors explored a novel method for measuring CSI in order to assess the degree of irresponsible behaviors. The authors build a CSI scale based on the perceptions of key informants, i.e. experts with diverse professional backgrounds. The authors apply CSI scale in a sample of 84 Spanish companies that were involved in CSI.FindingsThe results of the authors’ empirical study show the positive and significant influence of CEO narcissism and CEO power on the degree of CSI.Research limitations/implicationsOn the one hand, corporate irresponsibility scandals have relevant social consequences and practical implications. On the other hand, narcissism is a natural feature of managers in top positions that is increasing in societies.Practical implicationsThe authors’ findings may help CEOs, TMTs and corporate boards to acknowledge potential sources of CSI decreasing its likelihood through counterbalancing CEO's power and considering the dark side of narcissism.Social implicationsOn the one hand, corporate scandals have relevant social and practical implications. On the other hand, narcissism is a natural feature of managers in top positions that is increasing in societies.Originality/valueIn this paper, the authors highlight the role of CEOs characteristics and their firms as the key actors for explaining and understanding the degree of CSI.

CEO Political Ideology and Voluntary Forward-Looking Disclosure

Abstract This study investigates whether the management earnings forecasts of Republican and Democratic CEOs differ due to systematic differences in their information disclosure preferences. We find that Republican CEOs prefer a less asymmetric information environment than Democrat CEOs, and thus make more frequent, timelier, and more accurate disclosures than Democrat CEOs. Results using the propensity score matched sample and difference-in-differences analysis show that our results are unlikely to be driven by potential endogeneity. Our results are robust to controlling for various CEO characteristics and are stronger for firms with higher levels of institutional ownership and litigation risk.

The effect of CEOs’ being the only children in the family on their CSR engagement

Purpose This study aims to investigate the influence of CEO’s only-child status on corporate social responsibility (CSR) practices. It seeks to extend the understanding of upper echelon theory by examining unexplored CEO characteristics and their impact on CSR decisions. Design/methodology/approach The paper uses manually collected CEO family information and Chinese Stock and Market Accounting Research data as a basis to examine the influence of CEOs’ early-life experiences on their engagement in CSR activities. The study applies attachment security theory from developmental psychology and uses upper echelon theory, particularly focusing on CEOs’ only-child status. A comparative analysis of philanthropic donations between CEOs who are only children and those who have siblings is conducted. The study also examines the moderating effects of corporate slack resources and CEO shareholdings. Findings Preliminary findings suggest that CEOs who are only children are more likely to engage in CSR compared to their counterparts with siblings. However, the difference in donation amounts between the two groups tends to attenuate with decreased slack resources and increased CEO shareholdings. Originality/value To the best of the authors’ knowledge, this research represents the first attempt to investigate being the only child in one’s family and the CSR-related decision of CEOs, which extends the upper echelon theory by introducing the family science theory into the management domain.

Is your surname remunerative? Surname favorability and CEO compensation

We find that CEOs with more favorable surnames receive significantly higher compensation. The estimated effect of surname favorability is unique and incremental to the documented effects of various firm, board, and CEO characteristics. CEOs with French or German surnames receive significantly lower compensation after the French and German governments' opposition to the Iraq war. Surname favorability is not associated with corporate investments, disclosure policies, or firm performances. The results are more pronounced for professional (i.e., non-founder) or short-tenured CEOs and for firms with lower institutional ownership. Surname favorability reduces the likelihood of forced CEO turnover following poor stock performance but is not associated with a CEO's self-serving behaviors. Our results suggest that the effect of surname favorability is attributable to inefficient contracting by the board of directors. Our findings have implications for corporate stakeholders who have committed to the efficient contracting of CEO compensations.