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Whom to dismiss? CEO celebrity and management dismissal

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  • Park, Jong-Hun
  • Kim, Changsu
  • Sung, Yun-Dal

Abstract

Based on the power dynamics in strategic leadership ranks, this study examines whether chief executive officer (CEO) celebrity serves as a source of CEO power and empirically investigates its role in management dismissal. In the spirit of scapegoating theory, this study proposes that CEO celebrity weakens the likelihood of CEO dismissal but strengthens the likelihood of executive dismissal in the face of poor firm performance. This study goes further to explore the previously unexamined question of “whom to dismiss” and argues that less powerful non-board executives as opposed to board executives are more likely to be handy scapegoats of power dynamics. The data from Korean public firms in the aftermath of the Asian financial crisis largely support such a scapegoating hypothesis.

Suggested Citation

  • Park, Jong-Hun & Kim, Changsu & Sung, Yun-Dal, 2014. "Whom to dismiss? CEO celebrity and management dismissal," Journal of Business Research, Elsevier, vol. 67(11), pages 2346-2355.
    • Handle: RePEc:eee:jbrese:v:67:y:2014:i:11:p:2346-2355
    DOI: 10.1016/j.jbusres.2014.01.010
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    Cited by:

    1. Kevin Mayo & George Ball & Alex Mills, 2022. "CEO Tenure and Recall Risk Management in the Consumer Products Industry," Production and Operations Management, Production and Operations Management Society, vol. 31(2), pages 743-763, February.
    2. Marco Caiffa & Vincenzo Farina & Lucrezia Fattobene, 2020. "All that glitters is not gold: CEOs' celebrity beyond media content," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 25(3), pages 444-460, July.
    3. Zhou, Linzi & Long, Wenbin & Qu, Xin & Yao, Daifei, 2023. "Celebrity CEOs and corporate investment: A psychological contract perspective," International Review of Financial Analysis, Elsevier, vol. 87(C).
    4. Vo, Hong & Nguyen, Tien & Truong, Hang, 2023. "Economic policy uncertainty and corporate investment: An empirical comparison of Korean chaebol and non-chaebol firms," Finance Research Letters, Elsevier, vol. 54(C).
    5. Yu Wu & Yingyi Hu, 2021. "Chinese-style incentives: The intraindustry ripple effects of CEO awards," PLOS ONE, Public Library of Science, vol. 16(6), pages 1-18, June.

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