John C. Adams is an Assistant Professor of Finance in the Department of Finance and Real Estate, College of Business at the University of Texas at Arlington in Arlington, TX. Sattar A. Mansi is the Wells Fargo Professor of Finance in the Department of Finance, Insurance, and Law, Pamplin College of Business at Virginia Tech in Blacksburg, VA. Takeshi Nishikawa is an Assistant Professor of Finance in the School of Business at the University of Colorado Denver, CO.
Public versus Private Ownership and Fund Manager Turnover
Version of Record online: 20 DEC 2012
© 2012 Financial Management Association International.
Volume 42, Issue 1, pages 127–154, Spring 2013
How to Cite
Adams, J. C., Mansi, S. A. and Nishikawa, T. (2013), Public versus Private Ownership and Fund Manager Turnover. Financial Management, 42: 127–154. doi: 10.1111/j.1755-053X.2012.01220.x
The authors would like to thank Bill Christie (Editor), two anonymous referees, and seminar participants at Virginia Tech, University of Texas at Arlington, University of Colorado at Denver, the 2009 Southwestern Finance Association meeting, and the 2010 Financial Management Association meeting for valuable comments and suggestions that greatly improved the study. Mansi acknowledges financial support received from partial summer funding at Virginia Tech. The remaining errors are the sole responsibility of the authors.
- Issue online: 5 MAR 2013
- Version of Record online: 20 DEC 2012
We examine the correlation between organizational structure (public vs. private) and managerial turnover in a large sample of United States offered mutual funds. Consistent with the hypothesis that publicly traded and privately held firms have different incentive structures and, as such, should differ in their treatment of internal control mechanisms, we find that public sponsors are more sensitive to prior fund performance when making replacement decisions and experience smaller post turnover performance improvements. Additional testing suggests a greater likelihood of fund manager replacement when mutual funds are team managed and when fund boards are more independent.