IDEAS home Printed from https://ideas.repec.org/a/eee/bushor/v53y2010i1p21-29.html
   My bibliography  Save this article

When the CEO is ill: Keeping quiet or going public?

Author

Listed:
  • Perryman, Alexa A.
  • Butler, Frank C.
  • Martin, John A.
  • Ferris, Gerald R.

Abstract

CEOs represent the pinnacle of leadership in organizations. In addition to power and prestige, constant media scrutiny and pressures to exceed past levels of firm performance are often associated with this role. Although CEOs may rely on other top managers for input regarding operational decisions and long-term planning, the outcomes of strategic initiatives rest solely on their shoulders. Moreover, how CEOs are depicted in the press can greatly affect public opinion about their organizations. In recent years, CEO health and health concerns have made headlines for such well-known companies as McDonald's, Clorox, Pilgrim's Pride, and EarthLink. In this article we discuss the ramifications of disclosure and non-disclosure of serious CEO health issues, and their potential impact on shareholder wealth and succession planning. We conclude by offering a few thoughts about the future direction of CEO health.

Suggested Citation

  • Perryman, Alexa A. & Butler, Frank C. & Martin, John A. & Ferris, Gerald R., 2010. "When the CEO is ill: Keeping quiet or going public?," Business Horizons, Elsevier, vol. 53(1), pages 21-29, January.
    • Handle: RePEc:eee:bushor:v:53:y:2010:i:1:p:21-29
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0007-6813(09)00120-7
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Weisbach, Michael S., 1988. "Outside directors and CEO turnover," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 431-460, January.
    2. Kenneth A. Borokhovich & Kelly R. Brunarski & Maura S. Donahue & Yvette S. Harman, 2006. "The Importance of Board Quality in the Event of a CEO Death," The Financial Review, Eastern Finance Association, vol. 41(3), pages 307-337, August.
    3. Parrino, Robert, 1997. "CEO turnover and outside succession A cross-sectional analysis," Journal of Financial Economics, Elsevier, vol. 46(2), pages 165-197, November.
    4. Matthew C. Clayton & Jay C. Hartzell & Joshua Rosenberg, 2005. "The Impact of CEO Turnover on Equity Volatility," The Journal of Business, University of Chicago Press, vol. 78(5), pages 1779-1808, September.
    5. Mathew L. A. Hayward & Violina P. Rindova & Timothy G. Pollock, 2004. "Believing one's own press: the causes and consequences of CEO celebrity," Strategic Management Journal, Wiley Blackwell, vol. 25(7), pages 637-653, July.
    6. Dalton, Catherine M., 2006. "A recipe for success in succession planning," Business Horizons, Elsevier, vol. 49(3), pages 175-177.
    7. Wei Shen & Albert A. Cannella,, 2003. "Will succession planning increase shareholder wealth? evidence from investor reactions to relay CEO successions," Strategic Management Journal, Wiley Blackwell, vol. 24(2), pages 191-198, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ben Moews & J. Michael Herrmann & Gbenga Ibikunle, 2018. "Lagged correlation-based deep learning for directional trend change prediction in financial time series," Papers 1811.11287, arXiv.org, revised Nov 2018.
    2. Ben Moews & Gbenga Ibikunle, 2020. "Predictive intraday correlations in stable and volatile market environments: Evidence from deep learning," Papers 2002.10385, arXiv.org.
    3. Summers, James K. & Munyon, Timothy P. & Perryman, Alexa A. & Ferris, Gerald R., 2010. "Dysfunctional executive behavior: What can organizations do?," Business Horizons, Elsevier, vol. 53(6), pages 581-590, November.
    4. Daniel L. Gamache & Cynthia E. Devers & Felice B. Klein & Timothy Hannigan, 2023. "Shifting perspectives: How scrutiny shapes the relationship between CEO gender and acquisition activity," Strategic Management Journal, Wiley Blackwell, vol. 44(12), pages 3012-3041, December.
    5. Moews, Ben & Ibikunle, Gbenga, 2020. "Predictive intraday correlations in stable and volatile market environments: Evidence from deep learning," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 547(C).
    6. Hansin Bilgili & Joanna Tochman Campbell & Alan E. Ellstrand & Jonathan L. Johnson, 2017. "Riding off into the Sunset: Organizational Sensegiving, Shareholder Sensemaking, and Reactions to CEO Retirement," Journal of Management Studies, Wiley Blackwell, vol. 54(7), pages 1019-1049, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Campbell, T. Colin & Gallmeyer, Michael & Johnson, Shane A. & Rutherford, Jessica & Stanley, Brooke W., 2011. "CEO optimism and forced turnover," Journal of Financial Economics, Elsevier, vol. 101(3), pages 695-712, September.
    2. M. Martin Boyer & Hernán Ortiz‐Molina, 2008. "Career Concerns of Top Executives, Managerial Ownership and CEO Succession," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(3), pages 178-193, May.
    3. Dirk Jenter & Katharina Lewellen, 2021. "Performance-Induced CEO Turnover [The “Wall Street Walk” and shareholder activism: Exit as a form of voice]," The Review of Financial Studies, Society for Financial Studies, vol. 34(2), pages 569-617.
    4. Paul Farah & Hui Li, 2021. "CEO Turnovers: Transparency of Announcements and the Outperformance Puzzle," IJFS, MDPI, vol. 9(3), pages 1-22, June.
    5. Kind, Axel & Schläpfer, Yves, 2011. "Are forced CEO turnovers good or bad news?," Working papers 2011/10, Faculty of Business and Economics - University of Basel.
    6. Elsaid, Eahab & Davidson III, Wallace N., 2009. "What happens to CEO compensation following turnover and succession?," The Quarterly Review of Economics and Finance, Elsevier, vol. 49(2), pages 424-447, May.
    7. Florian S. Peters & Alexander F. Wagner, 2014. "The Executive Turnover Risk Premium," Journal of Finance, American Finance Association, vol. 69(4), pages 1529-1563, August.
    8. Chin-Tsai Lin & Yi-Hsien Wang, 2005. "An Analysis of Political Changes on Nikkei 225 Stock Returns and Volatilities," Annals of Economics and Finance, Society for AEF, vol. 6(1), pages 169-183, May.
    9. Bushman, Robert M. & Smith, Abbie J., 2001. "Financial accounting information and corporate governance," Journal of Accounting and Economics, Elsevier, vol. 32(1-3), pages 237-333, December.
    10. Ahn, Sanghoon & Bhattacharya, Utpal & Jung, Taehun & Nam, Giseok, 2009. "Do Japanese CEOs matter?," Pacific-Basin Finance Journal, Elsevier, vol. 17(5), pages 628-650, November.
    11. Dahya, Jay & McConnell, John J., 2005. "Outside directors and corporate board decisions," Journal of Corporate Finance, Elsevier, vol. 11(1-2), pages 37-60, March.
    12. Dah, Mustafa A. & Frye, Melissa B., 2017. "Is board compensation excessive?," Journal of Corporate Finance, Elsevier, vol. 45(C), pages 566-585.
    13. Masulis, Ronald W. & Wang, Cong & Xie, Fei, 2012. "Globalizing the boardroom—The effects of foreign directors on corporate governance and firm performance," Journal of Accounting and Economics, Elsevier, vol. 53(3), pages 527-554.
    14. McNeil, Chris & Niehaus, Greg & Powers, Eric, 2004. "Management turnover in subsidiaries of conglomerates versus stand-alone firms," Journal of Financial Economics, Elsevier, vol. 72(1), pages 63-96, April.
    15. Sam Yul Cho & Yohan Choi & Haemin Dennis Park & Jung Hyun Kwon, 2024. "One Man's Death is Another Man's Bread: The Effect of a CEO's Sudden Death on Competitors' Strategic Investments," Journal of Management Studies, Wiley Blackwell, vol. 61(4), pages 1192-1229, June.
    16. Renee B. Adams & Benjamin E. Hermalin & Michael S. Weisbach, 2010. "The Role of Boards of Directors in Corporate Governance: A Conceptual Framework and Survey," Journal of Economic Literature, American Economic Association, vol. 48(1), pages 58-107, March.
    17. Jalal, Abu M. & Prezas, Alexandros P., 2012. "Outsider CEO succession and firm performance," Journal of Economics and Business, Elsevier, vol. 64(6), pages 399-426.
    18. Loureiro, Gilberto & Makhija, Anil K. & Zhang, Dan, 2020. "One dollar CEOs," Journal of Business Research, Elsevier, vol. 109(C), pages 425-439.
    19. Li, Feng & Srinivasan, Suraj, 2011. "Corporate governance when founders are directors," Journal of Financial Economics, Elsevier, vol. 102(2), pages 454-469.
    20. Kevin J. Murphy & Jan Zabojnik, 2006. "Managerial Capital And The Market For Ceos," Working Paper 1110, Economics Department, Queen's University.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:bushor:v:53:y:2010:i:1:p:21-29. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/bushor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.