Government awards to CEOs

François Belot and Timothee Waxin
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François Belot: DRM - Dauphine Recherches en Management - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique
Timothee Waxin: DVRC - De Vinci Research Center - DVHE - De Vinci Higher Education

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Abstract: This paper investigates the value and corporate governance consequences of government awards for a sample of French CEOs appointed to the national Order of the Legion ofHonor (Légion d'honneur). Short-term market reactions surrounding award announcements are significantly positive, whereas the valuation of firms with awarded CEOs is greater than that of (matched) firms with nonawarded CEOs. We explore the channels through which government awards create value and find evidence that they provide awarded CEOs and their firms with increased political access. We also observe that government awards are associated with better corporate governance in that awarded CEOs are more likely to be fired for poor performance. The negative effects that have been documented for media awards and are associated with CEOs' superstar status do not seem to apply to state awards.

Keywords: CEO compensation; CEO outside directorships; CEO turnover; corporate governance; corporate performance; government awards; political connections (search for similar items in EconPapers)
Date: 2025-02-16
New Economics Papers: this item is included in nep-bec
Note: View the original document on HAL open archive server: https://hal.science/hal-04659614v2
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Published in Journal of Business Finance and Accounting, 2025, 52 (1), pp.472-510. ⟨10.1111/jbfa.12813⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04659614

DOI: 10.1111/jbfa.12813

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