The Research On The Performance Change Of Top Management Turnover In Listed Companies

In the modern society, as the rapid development of the economy and increasingly fierce competition, the importance of human resources to an enterprise is self-evident. The core competitiveness of an enterprise is increasingly reflected in the cultivation and use of the human resource as the first capital. As the head of the company's human resource, the top managers are the heart and soul of the company. He decides the company's development strategy and policies, and is also ultimately responsible for the company's operating performance. To some extent, the talent of the top manager usually determines the company's future prospects. As the separation of the company's ownership and management, there is a conflict of interest in the top managers and the shareholders. In order to safeguard the interests of shareholders, restrict the behavior of top managers to their own interests at the expense of shareholders, the company sets up a series of governance mechanisms to strengthen the supervision and constraints on the top managers. The determination of top management turnover with according to the company's performance level is an important part of the corporate governance. After 20 years of development, China's securities market has begun to take shape. But in the process of rapid development, a large number of top management turnovers has emerged. As the top managers play a decisive role in the company, the top management turnover is seen as one of the company's major strategic decision. It has a significant impact on both future development strategy and business performance. In this context, this paper selects the sample of the top management turnover in China's listed firms and studies the company's performance change after the top management turnover.This paper is divided into six chapters, the first chapter is an introduction, it analyzes the background, significance of domestic, foreign research review, research ideas and methods as well as innovation and inadequate. The second chapter elaborates the basic theory in relevant to the top management turnover, including the agency theory and corporate governance theory. The third chapter classifies the top management turnover, and analyzes the reason for the top management turnover. The forth chapter analyzes the performance change after the top management turnover from the angles of organizational changes and adjustments, successor choice and earnings management. The fifth chapter makes an empirical test on the performance change after the top management turnover. The empirical test consists of two parts. The first part is descriptive statistics, it analyzes current situation of China's top management turnover in 2006, including the ratio of top management turnover, industry distribution and disclosure of the turnover reasons. Then it analyzes the performance change after the top management turnover by contrasting the performance between the two years and after the turnover. The second part is a logistic regression test, it chooses the top management turnover or not as the independent variables, and chooses total return on equity and return on net assets as the dependent variable, and then analyzes the impaction of the top management turnover on the company's performance. The results shows that the company's performance in the senior year and one year after the turnover has improved, especially after a year, but in the second year after the turnover, the company's performance begins to decline. It shows that the top management turnover improves the company's performance only in the short term, but doesn't achieve remarkable results in the long term. The final chapter is the policy recommendations and research prospect. It puts forward countermeasures and research prospect to China's listed companies based on the empirical results.The innovation of this paper is to select the performance indicators of two years before and after the top management turnover and study the performance change after the top management turnover in a relatively longer time interval in order to reflect the impact of top management turnover on corporate performance, so that the results of empirical research is more scientific and comprehensive.