{"title":"Crowd-sourced CEO approval and turnover","authors":"","doi":"10.1016/j.irfa.2024.103587","DOIUrl":null,"url":null,"abstract":"<div><div>This study examines how employee approval ratings of CEOs improve the predictability of turnover. Using the crowd-sourced reviews from Glassdoor, we find that CEOs with high employee approval are less likely to be removed, even after a poor performance. The decrease in turnover–performance sensitivity is particularly strong when the relative importance of employees is greater in industries of higher intangible asset intensity and in states with strong employee protection. Firms with higher CEO approval subsequently show improved performance and lowered firm-specific risk. We highlight the role of employees as a key stakeholder in predicting CEO turnover, consistent with the value creation view of stakeholder capitalism.</div></div>","PeriodicalId":48226,"journal":{"name":"International Review of Financial Analysis","volume":null,"pages":null},"PeriodicalIF":7.5000,"publicationDate":"2024-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"International Review of Financial Analysis","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1057521924005192","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 0
Abstract
This study examines how employee approval ratings of CEOs improve the predictability of turnover. Using the crowd-sourced reviews from Glassdoor, we find that CEOs with high employee approval are less likely to be removed, even after a poor performance. The decrease in turnover–performance sensitivity is particularly strong when the relative importance of employees is greater in industries of higher intangible asset intensity and in states with strong employee protection. Firms with higher CEO approval subsequently show improved performance and lowered firm-specific risk. We highlight the role of employees as a key stakeholder in predicting CEO turnover, consistent with the value creation view of stakeholder capitalism.
期刊介绍：
The International Review of Financial Analysis (IRFA) is an impartial refereed journal designed to serve as a platform for high-quality financial research. It welcomes a diverse range of financial research topics and maintains an unbiased selection process. While not limited to U.S.-centric subjects, IRFA, as its title suggests, is open to valuable research contributions from around the world.
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