Why Do Firms Appoint CEOs as Outside Directors

摘要: We examine the determinants of appointments outside CEOs to boards and how these impact appointing companies. find that are most likely join large established firms geographically close, pursue similar financial investment policies, have comparable governance mechanisms their own firms. It is also more with low insider ownership already other CEO directors. Except for case board interlocks, there no evidence supporting view directors any on firm during tenure, either positively or negatively. Appointments do not a significant firm's operating performance, its decision-making, compensation CEO, monitoring management by board. However, performance drops significantly director when sits appointee's firm.