Author:
Suherman Suherman,Mahfirah Titis Fatarina,Usman Berto,Kurniawati Herni,Kurnianti Destria
Abstract
PurposeThe purpose of this study was to investigate how chief executive officer (CEO) characteristics, including age, education, nationality and particularly gender, influence firm performance in a developing Southeast Asian Country (Indonesia).Design/methodology/approachThe study uses balanced firm-level panel data for 203 nonfinancial companies listed on the Indonesia Stock Exchange from 2010 to 2020. Return on assets, return on equity and Tobin’s Q were used to measure firm performance. The data were analyzed using panel data regression analysis, including a fixed effects model with clustered standard errors.FindingsThe results indicate that female CEOs, education and nationality enhance firm performance, while CEO age can either improve or reduce firm performance. Numerous robustness checks were performed; the results were consistent with those in the main analysis.Research limitations/implicationsIndividual characteristics should be considered when appointing CEOs. Some CEO characteristics enhance firm performance. Female CEOs bring new perspectives, while older CEOs’ longer experience adds a competitive advantage. More educated CEOs have a better ability to deal with challenging intellectual activities, and CEOs from foreign countries better understand international market regulations. However, some characteristics may reduce firm performance, for example, older CEOs are more conservative and unable to adapt to changing business environments.Originality/valueThis study contributes to corporate governance studies by synthesizing CEO characteristics and investigating their relationship with firm performance. Moreover, it emphasizes that developing countries such as Indonesia have different economic, legal, social and cultural environments than developed countries, especially Western countries.
Subject
Business, Management and Accounting (miscellaneous)
Reference137 articles.
1. Hambrick and Mason’s “upper echelons theory”: evolution and open avenues;Journal of Management History,2018
2. A theory of friendly boards;The Journal of Finance,2007
3. The changing of the boards: the impact on firm valuation of mandated female board representation;The Quarterly Journal of Economics,2012
4. The effect of CEO characteristics on firm performance of food and beverage companies in Indonesia, Malaysia and Singapore;Quality-Access to Success,2022
5. Chief executive officer attributes, board structures, gender diversity, and firm performance among French CAC 40 listed firms;Research in International Business and Finance,2018
Cited by
9 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献