New CEOs Pursue Their Own Self-Interests by Sacrificing Stakeholder Value  

Oleh:

Harrison, Jeffrey S. ; Fiet, James O.

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: Journal of Business Ethics vol. 19 no. 3 (Apr. 1999), page 301-308.
Topik: Self-Interest Behavior; Stakeholders; Chief Executive Officer; Executive Succession; Pension Funding; Research and Development

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: BB27.37 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

Short-term performance increases that are sometimes observed after CEO successions may be evidence of self-interested behavior. New CEOs may cut allocations to long-term investment areas such as research and development (R&D), capital equipment and pension funds in an effort to drive up short-term profits and secure their positions. However, such actions have unfavorable consequences for some stakeholders. This study provides evidence that both R&D and pension funding are reduced subsequent to a succession, even after accounting for industry trends. The expected short-term profitability increases are also observed. A major implication of these results is that boards of directors and other interested parties should carefully monitor the actions of new CEOs with regard to their treatment of R&D and pension funding if they would like to prevent such actions from occurring. This study also highlights the need to investigate other potential self-interested behaviors of new CEOs.

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