Prerequisites: The only prerequisite for this seminar is some exposure to corporate law or corporate governance
Exam Type: No exam.
Individual participants may be asked to present assigned readings and will be asked to complete a 20-25 page paper, based either on secondary sources or primary research into a turnover-related dataset.
This seminar reviews the literature on management and director turnover in U.S. public corporations. Topics to be addressed include the proximate causes of turnover (e.g., retirements, terminations, and takeovers); relationships between turnover and corporate attributes such as firm performance, size, and ownership structure; the relationship between managerial compensation and turnover; the evolution of CEO and director turnover over time; and the merits of mandatory retirement and term limits (for corporate directors). Depending on available data, the seminar may also inquire into when turnover in the C-suite or the boardroom is a “team” phenomenon, i.e., when is turnover among a company’s directors and/or top managers highly intercorrelated. Finally, seminar readings will address the implications of turnover for corporate governance norms. Should turnover be encouraged by means of term limits or mandatory retirement ages? Should it be discouraged by practices that foster continuity in leadership, such as retaining a retiring CEO as the chairman of the board? How do these issues resemble other governance topics such as the value of independent directors or separating the roles of Chairman and CEO?