CEO Power, Risk-taking and Corporate Growth——An Empirical Study of China's Listed Companies

Abstract

Abstract:

Based on the data of China's A-share listed companies, we conduct some empirical studies and reach the following conclusions on the relationship among CEO power, risk-taking and corporate growth:(1) the more power a CEO has, the higher risk his company companies will face; (2) the effect of CEO power on corporate risk-taking in state owned companies is higher than that in non-state owned companies; (3) further, the risk-taking has a significant drag effect on corporate growth, that is to say, the higher risk a company faces, the worse its growth will be; (4) the negative effect of corporate risk-taking on corporate growth in state owned companies is more significant than that in non-state owned companies. This study provides some theoretical basis and solutions for listed companies, especially listed SOEs, to effectively prevent the over-centralization of CEO's power, take reasonable control of corporate risk-taking and improve corporate growth.

Key words: CEO power, risk-taking, corporate growth, drag effect

Li Haixia. CEO Power, Risk-taking and Corporate Growth——An Empirical Study of China's Listed Companies[J]. , 2017, 29(10): 198-210.

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