IDEAS home Printed from https://ideas.repec.org/a/kap/jmgtgv/v26y2022i2d10.1007_s10997-021-09566-w.html
   My bibliography  Save this article

The small world of German CEOs: a multi-method analysis of the affiliation network structure

Author

Listed:
  • Elena Semenova

    (Free University of Berlin)

Abstract

This paper seeks to understand the structure of corporate networks in the period following the dissolution of Deutschland AG (“Germany Inc.”). For this purpose, affiliation networks among chief executive officers (CEOs) that are based on common membership in various societal organizations will be examined. I apply an innovative mix of methods for studying a sample of CEOs from the 100 top companies in Germany in the 2010s. Based on social network analysis, I show that the overall affiliation network has all features of a small-world network, i.e., a high clustering coefficient and a short path length among the CEOs. The average degree of separation among German CEOs is only two steps. Another innovative contribution of this paper is its study of the linkage between affiliation network features and patterns of corporate recruitment. Using multiple correspondence analysis, I show that different subgroups of the overall affiliation network have their specific network characteristics and recruitment patterns. Within the network, managers from automotive and technical engineering often assume brokerage positions, while managers from the trade branch are largely isolated. This study shows that the affiliation networks and corporate recruitment patterns are interlinked; the transformation of corporate networks is a dynamic outcome of interrelations among different subgroups within the network, each with distinct educational, professional, and network characteristics.

Suggested Citation

  • Elena Semenova, 2022. "The small world of German CEOs: a multi-method analysis of the affiliation network structure," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 26(2), pages 519-550, June.
  • Handle: RePEc:kap:jmgtgv:v:26:y:2022:i:2:d:10.1007_s10997-021-09566-w
    DOI: 10.1007/s10997-021-09566-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10997-021-09566-w
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s10997-021-09566-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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. Francesca Mariotti & Rick Delbridge, 2012. "Overcoming Network Overload and Redundancy in Interorganizational Networks: The Roles of Potential and Latent Ties," Organization Science, INFORMS, vol. 23(2), pages 511-528, April.
    2. Mark Granovetter, 2005. "The Impact of Social Structure on Economic Outcomes," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 33-50, Winter.
    3. Jon M. Kleinberg, 2000. "Navigation in a small world," Nature, Nature, vol. 406(6798), pages 845-845, August.
    4. repec:ucp:bkecon:9789053569733 is not listed on IDEAS
    5. Hwang, Byoung-Hyoun & Kim, Seoyoung, 2009. "It pays to have friends," Journal of Financial Economics, Elsevier, vol. 93(1), pages 138-158, July.
    6. Davoine, Eric & Ravasi, Claudio, 2013. "The relative stability of national career patterns in European top management careers in the age of globalisation: A comparative study in France/Germany/Great Britain and Switzerland," European Management Journal, Elsevier, vol. 31(2), pages 152-163.
    7. Kirchmaier, Thomas & Stathopoulos, Konstantinos, 2008. "From fiction to fact: the impact of CEO social networks," LSE Research Online Documents on Economics 24427, London School of Economics and Political Science, LSE Library.
    8. Chikh, Sabrina & Filbien, Jean-Yves, 2011. "Acquisitions and CEO power: Evidence from French networks," Journal of Corporate Finance, Elsevier, vol. 17(5), pages 1221-1236.
    9. Rayna Brown & Ning Gao & Edward Lee & Konstantinos Stathopoulos, 2012. "What Are Friends for? CEO Networks, Pay and Corporate Governance," Springer Books, in: Sabri Boubaker & Bang Dang Nguyen & Duc Khuong Nguyen (ed.), Corporate Governance, edition 127, pages 287-307, Springer.
    Full references (including those not matched with items on IDEAS)

    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. Griffin, Paul A. & Hong, Hyun A. & Liu, Yun & Ryou, Ji Woo, 2021. "The dark side of CEO social capital: Evidence from real earnings management and future operating performance," Journal of Corporate Finance, Elsevier, vol. 68(C).
    2. Fuchs, Florian & Fuess, Roland & Jenkinson, Tim & Morkoetter, Stefan, 2017. "Winning a Deal in Private Equity: Do Educational Networks Matter?," Working Papers on Finance 17155, University of St. Gallen, School of Finance.
    3. Godechot, Olivier & Horton, Joanne & Millo, Yuval, 2019. "Structural exchange pays off: Reciprocity in boards and executive compensations in US firms (1990-2015)," MaxPo Discussion Paper Series 19/1, Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo).
    4. Philip L. Hersch & Jodi E. Pelkowski, 2014. "Does General Manager Networking Affect Choice of Trade Partners in Major League Baseball?," Journal of Sports Economics, , vol. 15(6), pages 601-616, December.
    5. Lalanne, Marie & Seabright, Paul, 2016. "The old boy network: The impact of professional networks on remuneration in top executive jobs," SAFE Working Paper Series 123, Leibniz Institute for Financial Research SAFE.
    6. Chahine, Salim & Fang, Yiwei & Hasan, Iftekhar & Mazboudi, Mohamad, 2019. "Entrenchment through corporate social responsibility: Evidence from CEO network centrality," International Review of Financial Analysis, Elsevier, vol. 66(C).
    7. El-Khatib, Rwan & Fogel, Kathy & Jandik, Tomas, 2015. "CEO network centrality and merger performance," Journal of Financial Economics, Elsevier, vol. 116(2), pages 349-382.
    8. Beneish, Messod D. & Marshall, Cassandra D. & Yang, Jun, 2017. "Explaining CEO retention in misreporting firms," Journal of Financial Economics, Elsevier, vol. 123(3), pages 512-535.
    9. Francis, Bill & Hasan, Iftekhar & John, Kose & Waisman, Maya, 2012. "Urban agglomeration and CEO compensation," Bank of Finland Research Discussion Papers 17/2012, Bank of Finland.
    10. Tristan Auvray & Olivier Brossard, 2013. "French connection: interlocking directorates and the ownership-control nexus in an insider governance system," Working Papers hal-00842582, HAL.
    11. Nicoletta Berardi & Marie Lalanne & Paul Seabright, 2019. "Professional Networks and their Coevolution with Executive Careers," Working papers 723, Banque de France.
    12. Liu, Yun, 2014. "Outside options and CEO turnover: The network effect," Journal of Corporate Finance, Elsevier, vol. 28(C), pages 201-217.
    13. repec:zbw:bofrdp:2012_017 is not listed on IDEAS
    14. Liu, Yun & Nanda, Vikram & Onal, Bunyamin & Silveri, Sabatino, 2021. "Employment mobility and pay for sector performance," Journal of Corporate Finance, Elsevier, vol. 70(C).
    15. Wang, Jianxin & Huang, Cailing & Xu, Lin & Zhang, Junhuan, 2023. "Drinking into friends: Alcohol drinking culture and CEO social connections," Journal of Economic Behavior & Organization, Elsevier, vol. 212(C), pages 982-995.
    16. Francis, Bill B. & Hasan, Iftekhar & John, Kose & Waisman, Maya, 2016. "Urban Agglomeration and CEO Compensation," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 51(6), pages 1925-1953, December.
    17. Berardi, Nicoletta & Lalanne, Marie & Seabright, Paul, 2018. "Professional networks and their coevolution with executive careers: Evidence from North America and Europe," SAFE Working Paper Series 243, Leibniz Institute for Financial Research SAFE.
    18. Berger, Allen N. & Kick, Thomas & Koetter, Michael & Schaeck, Klaus, 2013. "Does it pay to have friends? Social ties and executive appointments in banking," Journal of Banking & Finance, Elsevier, vol. 37(6), pages 2087-2105.
    19. Faia, Ester & Mayer, Maximilian & Pezone, Vincenzo, 2020. "The Value of Firm Networks: A Natural Experiment on Board Connections," CEPR Discussion Papers 14591, C.E.P.R. Discussion Papers.
    20. Zhao, Y., 2010. "The role of directors’ professional and social networks in CEO compensation and the managerial labour market," Other publications TiSEM 42a65171-00c0-46e2-800c-b, Tilburg University, School of Economics and Management.
    21. Fuchs, Florian & Füss, Roland & Jenkinson, Tim & Morkoetter, Stefan, 2021. "Winning a deal in private equity: Do educational ties matter?," Journal of Corporate Finance, Elsevier, vol. 66(C).

    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:kap:jmgtgv:v:26:y:2022:i:2:d:10.1007_s10997-021-09566-w. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.