Younger Executives Research Articles

Toward greener supply chains: Analysis of the determining factors

The green supply chain (GSC) has become essential for companies seeking to improve their environmental performance and meet the requirements of sustainable development. This concept is particularly relevant in an era of globalization and growing environmental awareness. The study used a Probit regression method to analyze data collected from Moroccan SMEs. It aimed to examine the impact of different factors, such as economic and energy efficiency, government incentives, stakeholder pressure, managerial age, company size, and profitability, on the adoption of GSC practices. The results showed that economic and energy efficiency, as well as stakeholder pressure, are significant factors positively influencing the adoption of GSCs. When combined with stakeholder pressure, government incentives also have a positive impact. The age of the executive has a negative influence on the adoption of GSC, indicating that younger executives are more likely to adopt these practices. Company size showed no significant impact, while profitability had a positive impact with the adoption of a GSC.

Corporate political transparency and the cost of debt

We examine the relation between borrowing firms’ corporate political transparency and the cost of debt. Using a sample of S&P 500 firms over the 2012–2016 period, we document a significant negative association between firms’ corporate political transparency and their cost of debt. We also find that the negative association is more pronounced when the borrowing firms are in less unionized industries and have younger executives (CEOs or board of directors). Our results are robust to a variety of sensitivity tests.

Entrepreneurial orientation of SMEs? executives in the comparative perspective for Czechia and Turkey

Research background: The executives of SMEs that have higher innovativeness, risk taking, proactiveness, competitive aggressiveness and autonomy dynamize the strategic posture of SMEs, thus, those firms can reach better financial and economic conditions. However, existence of many differences among countries, such as cultural values and market conditions, can cause variations in EO of these executives. Therefore, this fact can be one of the reasons why the performance and financial power of SMEs differ in various countries. 
 Purpose of the article: This study aspires to find out the differences in entrepreneurial orientation (EO) of younger and older, female and male, and more and less educated executives of SMEs from various countries.
 Methods: 1141 Czech and 479 Turkish executives were analyzed separately by the Mann-Whitney U test, to find out the differences in EO. The researcher ran the analyzes by SPSS Statistical Software.
 Findings & Value added: The results indicate that risk-taking and competitive aggressiveness of the executives differ regarding their gender, while innovativeness, proactiveness and autonomy do not. While there are significant differences between proactiveness, autonomy and innovativeness of older and younger executives, no differences exist in risk-taking and competitive aggressiveness. Regarding educational status, more educated executives perform better in innovativeness, proactiveness and autonomy, while less educated executives have higher propensities in risk taking and competitive aggressiveness. Masculinity, fear of failure, perception of obstacles, motivation of SMEs? executives and location of businesses might be the reasons of these results. By including the survey respondents from different countries and all dimensions of EO into the analyses, this study finds similarities and differences in gender, age and education levels and of SMEs? executives and their EO. This research also suggests some policies for governments and institutions to close the gap between EO of the executives. These facts not only make this research to unique, but also constitute a valuable addition to the literature.

Tournament Incentives, Age Diversity and Firm Performance: Evidence from China

This study introduces a new dimension, age diversity of non-CEO executives, which moderates the relationship between promotion-based tournament incentives, measured as the pay gap between the CEO and non-CEO executives, and firm performance. For a sample of Chinese listed firms from 2005 to 2015, we find that the tournament incentives for non-CEO executives relate positively to firm performance. This relationship is weaker when non-CEO executives are from three or more age cohorts whereas the tournament effect is enhanced when non-CEO executives are from the same age cohort. We reason that the peer pressure among the similar-aged non-CEO executives enhances the tournament competition and that age hierarchy reduces incentives for younger executives to compete. Our findings have important implications for corporations in China and other countries (e.g., Japan, Korea, Latin America, Africa) in which seniority is highly valued when setting executive compensations as well as optimizing organizational structure.

Influence of age and gender on decision-making models and leadership styles of non-profit executives in Texas, USA

Purpose The purpose of this study is to fill the gap by investigating the relationship between age and other demographics on decision-making and leadership styles of executives in the non-profit sector. Design/methodology/approach This study is a quantitative research using correlation analysis and analysis of variance. The quantitative approach establishes facts, makes predictions and tests stated hypothesis and used the Pearson correlation coefficient, the ANOVA and the two-way analysis of variance. This study used surveys to collect data. Findings H1 states that there will be no significant difference in the decision-making models used among non-profit organizational leaders (rational, intuitive, dependent, spontaneous and avoidant) based on demographic variables: gender and age. H2 states that there will be no significant difference in the leadership style used among non-profit organizational executives (selling, telling, delegating and participating) and different dimensions of demographic variables: gender and age. Research limitations/implications This study explored the relationship between the demographics, age and gender and the decision-making models (rational, intuitive, dependent, spontaneous and avoidant) and leadership styles (selling, telling, delegating and participating) of executives in non-profit organizations. The age of the executives also showed to be important factors that influenced executive’s leadership styles and decision-making models as well. Practical implications Rational decision-making as reflected to in this study has been used by older, possibly more experienced non-profit executives. This model is favorable towards making decisions on complicated issues. The final choice rational decision-makers select will maximize the outcome; it is assumed that the decision-maker will choose the alternative that rates the highest and get the maximum benefits (Robbins and Decenzo, 2003, pp. 141-142). The researcher suggests that non-profit executives, especially the younger executives, should attend management and leadership conferences that focus on rational decision-making models as concerns business strategies and making the best choices based on possible alternatives. Social implications Rational decision-making as reflected to in this study has been used by older, possibly more experienced non-profit executives. This model is favorable towards making decisions on complicated issues. The final choice rational decision-makers select will maximize the outcome; it is assumed that the decision-maker will choose the alternative that rates the highest and get the maximum benefits (Robbins and Decenzo, 2003, pp. 141-142). The researcher suggests that non-profit executives, especially the younger executives, should attend management and leadership conferences that focus on rational decision-making models as concerns business strategies and making the best choices based on possible alternatives. Originality/value This is an original piece of research that contributes to the literature on leadership style.

Cognitive predictors and age-based adverse impact among business executives.

Age differences on measures of general mental ability and specific cognitive abilities were examined in 2 samples of job applicants to executive positions as well as a mix of executive/nonexecutive positions to determine which predictors might lead to age-based adverse impact in making selection and advancement decisions. Generalizability of the pattern of findings was also investigated in 2 samples from the general adult population. Age was negatively related to general mental ability, with older executives scoring lower than younger executives. For specific ability components, the direction and magnitude of age differences depended on the specific ability in question. Older executives scored higher on verbal ability, a measure most often associated with crystallized intelligence. This finding generalized across samples examined in this study. Also, consistent with findings that fluid abilities decline with age, older executives scored somewhat lower on figural reasoning than younger executives, and much lower on a letter series test of inductive reasoning. Other measures of inductive reasoning, such as Raven's Advanced Progressive Matrices, also showed similar age group mean differences across settings. Implications for employee selection and adverse impact on older job candidates are discussed.

Employee-Based Brand Equity: Why Firms with Strong Brands Pay Their Executives Less

This article examines the concept of employee-based brand equity—the value that a brand provides to a firm through its effects on the attitudes and behaviors of its employees—and empirically demonstrates its significance on executive pay. Executives value being associated with strong brands and, therefore, accept substantially lower pay at firms that own strong brands. Consistent with identity theory, this effect is stronger for chief executive officers and younger executives than for other executives. Data from a large, cross-industry sample of executives suggest that academics and practitioners should take a broader view of the contributions of brand-related investments to firm value and make use of strong brands in pay negotiations that are typically viewed as being outside the realm of marketing.

An Empirical Examination of Executive Signing Bonuses: An Incentive Mechanism

We examine signing bonuses awarded to executives hired for or promoted to Named Executive Officer (NEO) positions at S&P 1500 companies during the period of 1992–2011. Executive signing bonuses are sizeable and increasing in use, and are labeled by the media as “golden hellos.” We find that executive signing bonuses are mainly awarded at firms with greater information asymmetry and higher innate risks, especially to younger executives, to mitigate the executives’ concerns about termination risk. When termination concerns are strong, signing bonus awards are associated with better performance and retention outcomes.

How Do Ex Ante Severance Pay Contracts Fit into Optimal Executive Incentive Schemes?

ABSTRACTWe analyze a sample of over 3,600 ex ante explicit severance pay agreements in place at 808 firms and show that firms set ex ante explicit severance pay agreements as one component in managing the optimal level of equity incentives. Younger executives are more likely to receive explicit contracts and better terms. Firms with high distress risk, high takeover probability, and high return volatility are significantly more likely to enter into new or revised severance contracts. Finally, ex post payouts to managers are largely determined by the ex ante contract terms.

How do ex-ante severance pay contracts fit into optimal executive incentive schemes?

We analyze a sample of over 3,600 ex ante explicit severance pay agreements in place at 808 firms and show that firms set ex ante explicit severance pay agreements as one component in managing the optimal level of equity incentives. Younger executives are more likely to receive explicit contracts and better terms. Firms with high distress risk, high takeover probability, and high return volatility are significantly more likely to enter into new or revised severance contracts. Finally, ex post payouts to managers are largely determined by the ex ante contract terms.

Study on the Guidance Consultants’ Training Needs, Based on the ‘Support Plan for Socially Vulnerable Groups’ in Greece

The present study attempts to investigate the training needs (in terms of guidance, methodology, responsiveness to specific group - target) of Vocational Consulting, who worked in the "Plan Support of Socially Vulnerable Groups," held by the Prefectural Committee for Adult Education (NELE) Larissa from September 2006 until September 2008. Firstly, it investigates the knowledge of the Executive Advisory body to the meaning and role of the Advisory as a science. Subsequently, it investigates the awareness of training needs specifying areas and linking those needs with the requirements of the group and the target which is supported. The analysis of the results and their connection to the research questions suggests that the Consultants consider their role especially important, realizing the essence and importance of the process and, moreover, that a further training in counselling skills is needed. This is a view expressed both by the most experienced executives, who have been involved in the process of training at least once, and the younger executives, who have not ever attended a training program in counselling.

Paying for Risk or Shareholder Rip-Off? An Analysis of Ex-Ante Severance Pay Contracts

We analyze a sample of over 3,600 ex ante explicit severance pay agreements in place at 808 firms and show that firms set ex ante explicit severance pay agreements as one component in managing the optimal level of equity incentives. Younger executives are more likely to receive explicit contracts and better terms. Firms with high distress risk, high takeover probability and high return volatility are significantly more likely to enter into new or revised severance contracts. Finally, ex post payouts to managers are largely determined by the ex ante contract terms.

Private Benefits in IPOs: Evidence from State-Owned Firms

It is a common notion that a significant conflict of interest exists between the state and the bureaucrats who control state-owned firms because the bureaucrats have essentially all the control rights but negligible cash flow rights in those firms. Yet, there is little systematic evidence on whether and how bureaucrats pursue private benefits at the cost of the state-owned firms. Using data from IPOs of state-owned firms in China, we find strong evidence that CEOs of state firms attempt to get promotions in the bureaucratic hierarchy by underpricing IPOs and allocating IPO shares to parties important to their careers. Specifically, we find that i) executives' chance of promotion is positively correlated with the level of IPO underpricing, and ii) those executives who can benefit more from underpricing, such as younger executives and those with government experience, actually underprice more. We don't find similar effects in private firms. These results point to a source of efficiency gains that privatization may achieve.

Interim management as a value generator

More and more pharma and biotech companies are realising the value of taking on experienced personnel on a short-term basis, to do project work, to fill in while a permanent recruitment is made and to add value to an existing position. It is also becoming more common these days that younger executives are seeking out interim positions as a career, since they enjoy the new challenges and flexibility of the appointments. The experience that an interim manager can bring into a company, on a short-term assignment, cannot be over-estimated and more and more bio-pharma organisations are realising this.

Relationships between Top Management Team Characteristics and International Diversification: an Empirical Investigation*

Drawing on the executive demography and the upper‐echelons perspectives, this paper examines the relationships between top management team (TMT) characteristics (educational level, tenure, age, international experience and functional background) and firm international diversification. The study is based on a sample of 112 relatively large, internationally diversified US‐based firms in the manufacturing sector. Findings indicate that firms with higher levels of international diversification are likely to have TMTs characterized by higher educational level, shorter organizational tenures, younger executives and greater international experience. In addition, findings indicate that the relationships between TMT characteristics and international diversification are more dominant in better‐performing than in lower‐performing firms.

The career motivation of female executives in the Hong Kong public sector

Reports a study of female executives (n = 30) working in the public sector in Hong Kong. The research captures a set of organisational practices in transition: from a colonial to a post‐colonial setting, and from a bureaucracy that offered jobs for life to one that offers them on contract terms. The concept of career motivation is explored in the study through three dimensions of career resilience, career insight, and career identity. Overall, younger executives (n = 19) had higher levels of career motivation and were striving to attain additional responsibility and authority in work assignments, while senior executives (n = 11) were concerned with holding on to their previous accomplishments and competence in their occupational role. Moreover, the more ambiguity and uncertainty existing in the government office, the lesser the levels of career motivation. The results and their implications for future studies of career motivation are discussed.

The Theory and Practice of Corporate Finance: Evidence from the Field

We survey 392 CFOs about the cost of capital, capital budgeting, and capital structure. Large firms rely heavily on net present value techniques and the capital asset pricing model, while small firms are relatively likely to use the payback criterion. Older executives without an MBA are more likely to rely on payback than are younger executives with an MBA. Surprisingly, most companies use a single company-wide discount rate to evaluate a project in a new industry and country. In addition to market risk, firms also frequently adjust cash flows or discount rates for interest rate risk, exchange rate risk, business cycle risk, and inflation risk. Few firms adjust discount rates or cash flows for book-to-market, distress, or momentum risks. A majority of large firms have a tight or somewhat tight target debt ratio, in contrast to only one-third of small firms. Executives rely heavily on informal rules when choosing capital structure. The most important factors affecting debt policy are maintaining financial flexibility and having a good credit rating. When issuing equity, respondents are concerned about earnings per share dilution and recent stock price appreciation. We find some support for the pecking-order and trade-off capital structure hypotheses but little evidence that executives are concerned about asset substitution, asymmetric information, transactions costs, free cash flows, or personal taxes. If CFOs behave according to these deeper hypotheses, they apparently do so unknowingly.

Executive compensation and the horizon problem: a synthesis of the economics of age and decision management

Relates previous research on the importance of age in decision‐making to Fama and Jensen’s (1983) ideas on decision management, develops hypotheses on the age of managers and the use of stock‐based compensation in companies with long time horizons (i.e. growth companies) and tests them on 1979‐1987 data for a sample of US firms. Explains the methodology used and presents the results, which show that these firms tend to have younger subordinate executives (but not younger CEOs) and to use less stock‐based compensation the younger these executives are. Suggests this is because younger executives effectively extend the time horizon of older CEOs, thus reducing the need to do this through the compensation package.

In Japan, birds of a feather do flock together

The article presents the results of a study which examined the extent to which age, organizational and top management team tenure, and graduation from a prestigious university affects the rate of executive-level turnover in Japanese firms. The study indicated that differences in age, team tenure, and prestige in the university lead to higher turnover, particularly among younger executives. Executives under the age of 51 experienced a turnover rate of 100%. Firm size, performance, and industry membership did not affect these relationships.

DEMOCRATIC PARTICIPATION IN DECISION MAKING BY EMPLOYEES IN AMERICAN CORPORATIONS

The article explores the viewpoints of executives in a midwestern industrial area regarding the participatory management practices. It was found that younger executives are more liberal. The result...