Research Notes and Communication
CEO and director turnover in failing firms: An illusion of change?
Article first published online: 17 JAN 2007
Copyright © 1995 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 16, Issue 5, pages 393–400, 1995
How to Cite
Daily, C. M. and Dalton, D. R. (1995), CEO and director turnover in failing firms: An illusion of change?. Strat. Mgmt. J., 16: 393–400. doi: 10.1002/smj.4250160505
- Issue published online: 17 JAN 2007
- Article first published online: 17 JAN 2007
- Manuscript Revised: 17 JUN 1994
- Manuscript Received: 4 JAN 1993
- corporate governance;
- board composition;
- board leadership structure;
Firms facing imminent bankruptcy would seemingly be under some pressure to demonstrate effective governance structures as a means for maintaining the support of important external constituents and initiating a turnaround. Little is known, however, about CEO and director turnover and its impact on the composition and structure of the board in failing firms. This study assesses both the incidence and form of governance changes in the 5-year period prior to corporate bankruptcy. Despite extensive board member and CEO replacements. changes by firms at imminent risk of failure do not conform with the prescriptions favored by reform advocates and institutional investors.