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Does the origin of a succession CEO matter in the market value of innovation? Disentangling the origin of internal CEOs
Author(s) -
Wong YingJiuan,
Chen LiYu
Publication year - 2018
Publication title -
canadian journal of administrative sciences / revue canadienne des sciences de l'administration
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.347
H-Index - 48
eISSN - 1936-4490
pISSN - 0825-0383
DOI - 10.1002/cjas.1396
Subject(s) - ecological succession , business , perspective (graphical) , value (mathematics) , stock market , upper echelons , stock (firearms) , industrial organization , marketing , strategic management , engineering , history , context (archaeology) , mechanical engineering , ecology , archaeology , machine learning , artificial intelligence , computer science , biology
This study complements previous research regarding CEO origin and family businesses by incorporating upper echelons theory with the perspective of family effect as well as disentangling CEO origin to provide a better understanding of how external, unrelated internal, and family succession CEOs affect innovation performance. We further reveal how a family founder helps improve the value of innovations undertaken by family heirs. The results show that firms with unrelated internal succession CEOs experience higher (lower) stock market reactions to innovation announcements than those with family (external) succession CEOs. Founders serving on the board reduce the negative effect between family heirs and innovation performance. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.