CEO career horizons and when to go public: the relationship between risk-taking, speed and CEO power

Romano, Mauro; Cirillo, Alessandro; Mussolino, Donata; Pennacchio, Luca

doi:10.1007/s10997-017-9398-0

Cited by 19 publications

(49 citation statements)

References 93 publications

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“…new governance and disclosure standards; Pagano et al, 1998), undertaking the process of going public can undoubtedly be considered an entrepreneurial (risky) choice rather than a physiological step in the life cycle of firms (Lester et al, 2006;Romano et al, 2019). In this context, the time to IPO, measured as the time elapsed from a firm's foundation to its IPO, is a critical factor for both the firm and the market (Chang, 2004;Yang et al, 2011;Romano et al, 2019). Indeed, it can determine the success of the listing as well as the survivability of the firm in the equity market (Yang et al, 2011).…”

Section: Theoretical Background and Hypotheses Development Time To Ip...mentioning

confidence: 99%

“…In particular, the decision of when to undertake this process, known as the time to IPO (Yang et al, 2011), appears to be particularly critical for family firms. The timing of the IPO, which refers to the time elapsed between the establishment of a company and its listing (Yang et al, 2011), is crucial for the success of the process and for the firm's chance of survival in the equity market (Chang, 2004;Romano et al, 2019). It reflects a firm's performance before the IPO (Teng and Li, 2020), demonstrates that the firm is ready to grow and determines a firm's ability to raise funds from the market in the post-IPO phase (Chang, 2004).…”

Section: Introductionmentioning

confidence: 99%

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Timing the transition: gender diversity’s role in family IPOs

Carbone,

Mussolino,

Viganò

2024

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PurposeThis study investigates the relationship between board gender diversity (BGD) and the time to Initial Public Offering (IPO), which stands as an entrepreneurially risky choice, particularly challenging in family firms. We also investigate the moderating role of family ownership dispersion (FOD).Design/methodology/approachWe draw on an integrated theoretical framework bringing together the upper echelons theory and the socio-emotional wealth (SEW) perspective and on hand-collected data on a sample of Italian family IPOs that occurred in the period 2000–2020. We employ ordinary least squares (OLS) regression and alternative model estimations to test our hypotheses.FindingsBGD positively affects the time to IPO, thus, it increases the time required to go public. FOD negatively moderates this relationship. Our findings remain robust with different measures for BGD, FOD, and family business definition as well as with different econometric models.Originality/valueThe article develops literature on family firms and IPO and it enriches the academic debate about gender and IPOs in family firms. It adds to studies addressing the determinants of the time to IPO by incorporating gender diversity and the FOD into the discussion. Finally, it contributes to research on women and outcomes in family firms.

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Section: Theoretical Background and Hypotheses Development Time To Ip...mentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Timing the transition: gender diversity’s role in family IPOs

Carbone,

Mussolino,

Viganò

2024

Self Cite

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“…Indeed, a significant amount of research provide interesting insights into this relationship. For instance, empirical findings suggest that CEO power is associated with the firm's financial performance, performance volatility and productivity [27][28][29][30][31][32][33], IPO, M&A and divestitures [34][35][36]; innovativeness [37; 38]; dividend policy [39; 40], firm performance under turbulent conditions [41; 42] and most importantly for our study of the company's risk attitude [43][44][45][46][47][48][49].…”

Section: Ceo Power and Personality Traitsmentioning

confidence: 99%

Ceo Power and Risk-Taking: Intermediate Role of Personality Traits

Кораблев¹,

Подухович²

2022

КФ

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In our paper we discuss how different personal characteristics of a CEO, being affected by CEO power, may in turn affect personal risk-taking. Agency theory states that managers have non-changing risk preferences and are either risk-averse or risk-neutral. In contrast to that, there may be cases, when managers are risk-seekers and power of executives is positively related to excessive risk-taking. Additionally, agency theory assumes that CEOs are homogenous in power use and ignores difference of CEOs in term of personality traits as well as its impact on corporate decisions. Therefore, our aim is to focus specifically on factors that connect CEO power with CEO risk-taking and to analyze possible effects of that relationship on firm. Based on both psychological and managerial studies, we conclude that, on the one hand, CEO’s power can affect CEO’s personal traits by producing [in the case of overconfidence or hubris] or by enhancing them [in case of narcissism]. On the other hand, CEO’s personal traits affect CEO’s risk-taking. It can be either by changing the perception of risk or because of behavior patterns inherent to those traits. Finally, we hypothesize that CEO power can affect CEO personal risk-taking through personality traits. By examining relationship between CEO power and CEO risk-taking based on individual-level determinants, our paper adds to the behavioral corporate finance and corporate governance literature.

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“…The social influence of CEOs, which is often proxied by duality and organizational tenure (Krause et al , 2014; Wiersema et al , 2018), pertains to the interpersonal mechanisms that enable them to act opportunistically within the corporate context (O’Reilly and Main, 2010; Romano et al , 2019; Wade et al , 1990), e.g., to intervene in the compensation-setting procedure. It can be assumed that duality and tenure as proxies for social influence impact the board’s efficiency in translating carbon emission reduction strategy into a comprehensive set of carbon-related performance measures and that this impact is related to CEOs’ carbon-related awareness, risk profile and degrees of narcissism and hubris.…”

Section: Determinants Of Carbon-related Ceo Compensationmentioning

confidence: 99%

Mapping the determinants of carbon-related CEO compensation: a multilevel approach

Winschel

2021

SBR

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Purpose In view of the current climate change emergency and the growing importance of the climate-related accountability of companies, this paper aims to advance a comprehensive understanding of the determinants of carbon-related chief executive officer (CEO) compensation. Design/methodology/approach Building on the agency-theoretical perspective on executive compensation and existing work in the fields of management, corporate governance, cultural studies, and behavioral science, this paper derives a multilevel framework of the determinants of carbon-related CEO compensation. Findings This paper maps the determinants of carbon-related CEO compensation at the societal, organizational, group, and individual levels of analysis. It also provides research propositions on the determinants that can support and challenge the implementation of this instrument of environmental corporate governance. Originality/value In the past literature, the determinants of carbon-related CEO compensation have remained largely unexplored. This paper contributes to the academic discussion on environmental corporate governance by showcasing the role of interlinkages among the determinants of carbon-related CEO compensation and the possible countervailing impacts. In view of the complex interdisciplinary nature of climate change impact, this paper encourages businesses practitioners and regulators to intensify their climate change mitigation efforts and delineates the levers at their disposal.

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CEO career horizons and when to go public: the relationship between risk-taking, speed and CEO power

Cited by 19 publications

References 93 publications

Timing the transition: gender diversity’s role in family IPOs

Timing the transition: gender diversity’s role in family IPOs

Ceo Power and Risk-Taking: Intermediate Role of Personality Traits

Mapping the determinants of carbon-related CEO compensation: a multilevel approach

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