CEOs' hometown connections and corporate risk-taking: Evidence from China

Fanjie Fu, Jing Fang, Fan Zhang, Shujie Yao and Jinghua Ou

Emerging Markets Review, 2024, vol. 60, issue C

Abstract: Using hand-collected data on CEOs' hometown connections in Chinese A-share listed companies from 2009 to 2020, we find that such connections with suppliers are negatively associated with corporate risk-taking, reflected by the risk-taking behavior of CEOs with personal preference and self-interest. It is also found that the negative relationship between CEO hometown connections and corporate risk-taking is more pronounced for firms with greater economic policy uncertainty, firms in a period of tight monetary policy, firms with fewer analysts following, and firms with local CEOs, male CEOs, or CEOs without holding shares.

Keywords: Corporate risk-taking; CEO hometown connection; CEO preference; Uncertainty; Social networks (search for similar items in EconPapers)
JEL-codes: G17 G30 M12 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ememar:v:60:y:2024:i:c:s1566014124000244

DOI: 10.1016/j.ememar.2024.101129

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