Research On The Influencing Factors Of The CEO Turnover In Chinese Listed Companies

Studies on management turnovers of Chinese listed companies typically find that turnover decisions are responsive to companies' accounting performance.What is puzzling is that the performance subsequent to turnovers does not improve much. Base on the Agency Theory and Corporate Governance,this study adopt the CEO definition proposed by Kato(2006),using Chinese CEO turnover cases during 2004-2007,empirically analyze the influencing factor of the CEO turnover from many aspect,such as performance,size,risk,sales growth,the complexity of operation and ownership structure.This study disaggregates the profit before tax into three part:core earning,recurring non-core earning and other non-recurring earning.Upon going beyond the overall earning figure,this study show that CEO turnover decision is related negatively to recurring non-core earning significantly,especially in the government firms.This earning consists mainly of operating,administrative and financial expenses.Then,we can say that,to some extent,government firms are more concerned on cost control during making the CEO turnover decisions.And this finding may be used to explain the lack of significant performance improvements after management turnovers,which is unique in China. Moreover,this study find that CEO turnover decision is related positively to the asset-liability ratio significantly,the same as to the ownership concentration.