Mercer, Jeffrey M.
B.S. (Bachelor of Science)
Department of Finance
The objective of this paper is to examine the relationship between CEO duality (chairman of the board and CEO are the same individual) and firm performance and effIciency for a sample of large publicly traded bank holding companies. Prior research in this area is conflicting on whether or not management structure is of significance in regards to perfonnance and cost effIciency. The motivation for this line of research is that firms are questioning if principal-agent conflicts are involved when the CEO is also chairman of the board. The performance measures used in this study are: return on assets, Tobin's q, and market-to-book value. The efficiency+H12 measure used is general selling and administration expenses to total assets. This study is particularly unique in the way top management structures are grouped. Top management structures are grouped by chairman to avoid the possible principal-agent conflicts that may occur when a chairman is not CEO but holds another executive position. There was no evidence provided by this study that banks where the CEO is also chairman of the board underperform those banks where the CEO is not chairman of the board.
Goodman, Kristen, "CEO duality and its impact on large publicly traded bank holding companies" (1995). Honors Capstones. 274.
Northern Illinois University
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Chief Executive Officer duality and its impact on large publicly traded bank holding companies