Institutional ownership and senior-level executives' tenure
Institutional ownership and senior-level executives' tenure
In this paper, the authors document a positive relationship between senior-level executives' tenure and the shareholdings of institutional investors in US public firms between 1992 and 2013. The authors find that executive tenure is higher in the presence of institutional investors, and tenure is positively related to both the proportion of shares held by the institutional investors and the stability in their shareholdings. The results suggest that there exists a clientele effect with respect to the choice of senior executives by institutional investors. The authors further document that the positive relationship is true for pressure-sensitive institutional investors but not for pressure-insensitive ones. Our findings suggest that investors that have business ties with firms, other than their investments, are more likely to support a long-term working relationship with the firm executives.
executive tenure, executive turnover, institutional ownership, ownership stability, senior executives, shareholdings, institutional investors, USA, United States, working relationships, long-term relationships
103
Jory, Surendranath
2624eb24-850a-48f6-b3c6-c96749b87322
Ngo, Thanh
852ea7b9-fd74-4a39-9281-87626e50886b
2016
Jory, Surendranath
2624eb24-850a-48f6-b3c6-c96749b87322
Ngo, Thanh
852ea7b9-fd74-4a39-9281-87626e50886b
Jory, Surendranath and Ngo, Thanh
(2016)
Institutional ownership and senior-level executives' tenure.
International Journal of Corporate Governance, 7 (2), .
(doi:10.1504/IJCG.2016.078348).
Abstract
In this paper, the authors document a positive relationship between senior-level executives' tenure and the shareholdings of institutional investors in US public firms between 1992 and 2013. The authors find that executive tenure is higher in the presence of institutional investors, and tenure is positively related to both the proportion of shares held by the institutional investors and the stability in their shareholdings. The results suggest that there exists a clientele effect with respect to the choice of senior executives by institutional investors. The authors further document that the positive relationship is true for pressure-sensitive institutional investors but not for pressure-insensitive ones. Our findings suggest that investors that have business ties with firms, other than their investments, are more likely to support a long-term working relationship with the firm executives.
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Published date: 2016
Keywords:
executive tenure, executive turnover, institutional ownership, ownership stability, senior executives, shareholdings, institutional investors, USA, United States, working relationships, long-term relationships
Organisations:
Faculty of Business, Law and Art
Identifiers
Local EPrints ID: 399829
URI: http://eprints.soton.ac.uk/id/eprint/399829
ISSN: 1754-3037
PURE UUID: 1487283c-1654-40c0-8193-d794ce13b5b7
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Date deposited: 30 Aug 2016 11:39
Last modified: 15 Mar 2024 03:45
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Author:
Thanh Ngo
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