Boards Benefit From Dismissing CEOs Early: Study

Law360, New York (May 1, 2007, 12:00 AM EDT) -- Companies that dismiss poorly performing CEOs earlier rather than later are less likely to go bankrupt or be delisted from stock exchanges, according to a new study.

The study, which analyzed 430 firms that let their CEOs go between 1996 and 2003, disclosed that markets react negatively to early dismissals. It’s still worth it, however, because late CEO dismissals lead to larger and more permanent damages in shareholder value, according to the study.

“CEO dismissal decisions that come too late, i.e. after shareholders’ equity in the...
To view the full article, register now.

Law360 UK

UK Financial Services

Read Our Latest UK Legal News & Analysis

Financial Services Law360 UK and Insurance Law360 UK provide breaking news and in-depth analysis on U.K. and European Union regulation, enforcement, legislation, and litigation involving banks, investment firms, insurers, and more.