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dc.contributor.authorJagannathan, Muralien_US
dc.date.accessioned2014-03-14T20:21:23Z
dc.date.available2014-03-14T20:21:23Z
dc.date.issued1996-02-23en_US
dc.identifier.otheretd-183513359611541en_US
dc.identifier.urihttp://hdl.handle.net/10919/30322
dc.description.abstractThe dissertation empirically examines the efficacy of internal control mechanisms by analyzing 94 forced turnovers of chief executive officers (CEOs). It seeks to answer two primary questions: One, do governance-related characteristics influence the promptness with which poorly-performing CEOs are removed from office; and two, are removals of CEOs followed by changes in internal control mechanisms? The results suggest that poorly performing managers are removed more quickly in firms that have a larger percentage of independent outside directors on their board, that have higher equity ownership by the non-CEO directors and lower equity ownership by the CEO, and that separate the positions of CEO and chairperson. The results also suggest that the removal of the CEO provides both the opportunity and the incentive to alter internal governance systems. There is significant turnover of board members and the new boards generally have a higher fraction of independent outside directors and are more likely to separate the positions of CEO and chairperson. In addition, the sensitivity of CEO compensation to firm performance increases significantly following turnover. These post-turnover improvements in monitoring and incentive schemes are more significant in those firms that require a crisis in the product and/or capital market before they remove their CEOs. However, there is no evidence of short-term improvement in operating performance following changes in CEOs and governance systems. Overall, the results suggest that board and ownership characteristics do influence the effectiveness of internal monitoring systems and that CEO turnover is associated with broad changes in monitoring and incentive systems.en_US
dc.publisherVirginia Techen_US
dc.relation.haspartmurali.pdfen_US
dc.rightsI hereby grant to Virginia Tech or its agents the right to archive and to make available my thesis or dissertation in whole or in part in the University Libraries in all forms of media, now or hereafter known. I retain all proprietary rights, such as patent rights. I also retain the right to use in future works (such as articles or books) all or part of this thesis or dissertation.en_US
dc.subjectownershipen_US
dc.subjectboards of directorsen_US
dc.subjectcorporate governanceen_US
dc.subjectfirm performanceen_US
dc.subjectcompensationen_US
dc.titleInternal Control Mechanisms and Forced CEO Turnover: An Empirical Investigationen_US
dc.typeDissertationen_US
dc.contributor.departmentFinanceen_US
dc.description.degreePh. D.en_US
thesis.degree.namePh. D.en_US
thesis.degree.leveldoctoralen_US
thesis.degree.grantorVirginia Polytechnic Institute and State Universityen_US
thesis.degree.disciplineFinanceen_US
dc.contributor.committeememberPinkerton, John M.en_US
dc.contributor.committeememberKeown, Arthur J.en_US
dc.contributor.committeememberHansen, Robert S.en_US
dc.identifier.sourceurlhttp://scholar.lib.vt.edu/theses/available/etd-183513359611541/en_US
dc.contributor.committeecochairShome, Dilip K.en_US
dc.contributor.committeecochairDenis, Diane K.en_US
dc.date.sdate1998-07-17en_US
dc.date.rdate1996-02-23
dc.date.adate1996-02-23en_US


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