CEO power and matching leverage preferences
(2017) In Journal of Corporate Finance 45. p.19-30- Abstract
We study the effect of managerial power on CEOs' tendency to imprint their personal leverage preferences upon the firms they manage. Using a unique data source that allows us to measure personal wealth and indebtness in great detail, we find a connection between CEOs' personal leverage and that of their firms. The connection is driven by the CEOs with a longer tenure and the CEOs who serve in a dual role. The connection is significantly weaker for those CEOs who have a proportion of their personal wealth tied to the firm. Presence of block holders also weakens the connection.
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/9f5afaa6-975a-48e8-a0cd-87b38bd88ca3
- author
- Korkeamäki, Timo ; Liljeblom, Eva LU and Pasternack, Daniel
- organization
- publishing date
- 2017-08-01
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- CEO behaviour, Matching preferences, Personal leverage
- in
- Journal of Corporate Finance
- volume
- 45
- pages
- 12 pages
- publisher
- Elsevier
- external identifiers
-
- wos:000407655500002
- scopus:85018616926
- ISSN
- 0929-1199
- DOI
- 10.1016/j.jcorpfin.2017.04.007
- language
- English
- LU publication?
- yes
- id
- 9f5afaa6-975a-48e8-a0cd-87b38bd88ca3
- date added to LUP
- 2017-05-11 14:16:02
- date last changed
- 2025-07-23 19:28:40
@article{9f5afaa6-975a-48e8-a0cd-87b38bd88ca3, abstract = {{<p>We study the effect of managerial power on CEOs' tendency to imprint their personal leverage preferences upon the firms they manage. Using a unique data source that allows us to measure personal wealth and indebtness in great detail, we find a connection between CEOs' personal leverage and that of their firms. The connection is driven by the CEOs with a longer tenure and the CEOs who serve in a dual role. The connection is significantly weaker for those CEOs who have a proportion of their personal wealth tied to the firm. Presence of block holders also weakens the connection.</p>}}, author = {{Korkeamäki, Timo and Liljeblom, Eva and Pasternack, Daniel}}, issn = {{0929-1199}}, keywords = {{CEO behaviour; Matching preferences; Personal leverage}}, language = {{eng}}, month = {{08}}, pages = {{19--30}}, publisher = {{Elsevier}}, series = {{Journal of Corporate Finance}}, title = {{CEO power and matching leverage preferences}}, url = {{http://dx.doi.org/10.1016/j.jcorpfin.2017.04.007}}, doi = {{10.1016/j.jcorpfin.2017.04.007}}, volume = {{45}}, year = {{2017}}, }