CEO mobility and corporate policy risk

Korkeamäki, Timo; Colak, Gonul

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CEO mobility and corporate policy risk

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Title:	CEO mobility and corporate policy risk
Author(s):	Korkeamäki, Timo ; Colak, Gonul
Date:	2021-08
Language:	en
Pages:	28
Department:	School Services, BIZ Hanken School of Economics
Series:	JOURNAL OF CORPORATE FINANCE, Volume 69
ISSN:	0929-1199 1872-6313
DOI-number:	10.1016/j.jcorpfin.2021.102037
Keywords:	CEO mobility, Corporate policy risk, Shareholder value
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Citation: Korkeamäki , T & Colak , G 2021 , ' CEO mobility and corporate policy risk ' , JOURNAL OF CORPORATE FINANCE , vol. 69 , 102037 . https://doi.org/10.1016/j.jcorpfin.2021.102037
Abstract: Career concerns can limit a manager's willingness to take risks, which can lead to excessive policy conservatism. An increase in a CEO's ability and willingness to change jobs (CEO mobility) can diversify her human capital and reduce her conservatism. We derive several CEO mobility measures and relate them to a policy riskiness index that captures the overall risk embedded in a firm's corporate policies. We find a strong positive relation between CEO mobility and the riskiness of corporate policies. We also link external regulatory shocks that constrain labor mobility to significant drops in corporate risk-taking.

Permanent link to this item: http://urn.fi/URN:NBN:fi:aalto-202108258382 Email this Export to RefWorks QR Code Print BibTex Tweet