 Do CEO Characteristics Matter in Product Recalls?António Miguel Martins and Cesaltina Pires International Journal of the Economics of Business, 2023, vol. 30, issue 3, 207-232 Abstract: This study examines the effect of CEO characteristics such as gender, age, tenure, functional background, stock ownership, compensation scheme and dual role on the stock market returns of automobile companies, around the announcement of product recalls. Using an event study, for a sample of 2,576 product recalls in the US automobile industry, between January 2010 and June 2021, we observe that the stock market’s reaction to a product recall announcement is negative. However, the impacts on the cumulative abnormal returns around the announcement of product recalls of the company’s CEO being female, the CEO tenure, the CEO having an operations or marketing background, the ratio of CEO long-term compensation to total compensation and the CEO and Chairperson being the same person are all positive and statistically significant, showing that these CEO characteristics mitigate the negative effects on a company’s financial value caused by product recalls. Date: 2023 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:ijecbs:v:30:y:2023:i:3:p:207-232 Ordering information: This journal article can be ordered from DOI: 10.1080/13571516.2023.2213127 Access Statistics for this article International Journal of the Economics of Business is currently edited by Eleanor Morgan More articles in International Journal of the Economics of Business from Taylor & Francis Journals |
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