Firm performance and managerial succession in family managed firms

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56 Citations (Scopus)


This paper investigates whether the family status of a company's top officer affects managerial replacement decisions. We report evidence that family-managed companies are characterized by higher levels of board control and potentially weak internal governance systems. Family CEOs are less likely than non-family CEOs to depart their position following poor performance. Stock prices react favorably and operating performance improves when companies announce the departure of a family CEO. Overall, our evidence suggests that shareholders benefit when a powerful CEO leaves their position in the company.
Original languageEnglish
Pages (from-to)461-484
Number of pages24
JournalJournal of Business Finance and Accounting
Issue number3-4
Publication statusPublished - 6 May 2009


  • CEO turnover
  • corporate restructuring
  • family managed firms
  • firm performance


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