CEO busyness and firm performance: evidence from Indonesia

Iman Harymawan and Mohammad Nasih and Melinda Cahyaning Ratri and John Nowland (2019) CEO busyness and firm performance: evidence from Indonesia. Heliyon, 5 (5). ISSN 24058440

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This study investigates whether busy CEOs are associated with lower firm performance, and if this relationship is moderated by firm growth, CEO tenure and corporate governance practices in Indonesia. This study uses 876 firms-year observations from 268 firms listed on the Indonesia Stock Exchange (IDX)for the period spanning 2014 to 2017. We find that busy CEOs are associated with lower firm performance. This negative relationship is stronger in firms with high growth and when busy CEOs have shorter tenure. We also show that corporate governance practices have no impact on the negative relationship between CEO busyness and firm performance. For firms and shareholders, our findings indicate that it is not a good idea for CEOs to hold two or more outside directorships, particularly in the early years of taking up their CEO position. Our results suggest that restrictions on CEO busyness would be beneficial to shareholders. © 2019 The Authors

Item Type: Article
Uncontrolled Keywords: Business, Economics
Subjects: H Social Sciences > HB Economic Theory > HB1-3840 Economic theory. Demography
H Social Sciences > HF Commerce > HF5001-6182 Business
Divisions: Artikel Ilmiah > SCOPUS INDEXED JOURNAL
Iman HarymawanNIDN0020048403
Mohammad NasihNIDN0006086503
Melinda Cahyaning RatriNIM041411331034
John NowlandNIDN
ContributionNameNIDN / NIDK
Depositing User: PPJPI
Date Deposited: 19 Mar 2020 07:09
Last Modified: 19 Mar 2020 07:26
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