QUEEN’S BUSINESS SCHOOL FINANCE SEMINAR SERIES

Wednesday 24^th September

1pm

“Do CEOs Matter in the Long Run? Explaining Britain’s CEO Effect in the Twentieth Century”

Philip Fliers

QUB/QBS

Abstract: Drawing on the concept of managerial discretion we propose that variation in the CEO effect over time can be explained by changes in the formation of executives and the governance of the role of the CEO within firms. To test these ideas, we use a high-dimensional fixed-effects model and a ‘History to Theory’ framework, to examine how institutional and organizational characteristics explain change in the CEO effect in the UK. We use a hand-collected dataset of the largest 100 UK companies between 1900-2009. Our sample includes 407 firms, 1,558 CEOs, and c.14,000 firm-year observations of firm performance. We find that in the UK, the CEO effect fluctuates between 6-17% and gradually increased across the century. These trends can be correlated to changes in corporate governance practices and the levels of education and training obtained by CEOs.

Authors: Philip T. Fliers (presenting), Michael Aldous, John Turner

QBS Conference Hub, Seminar Room 01.012