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- All Subjects: Firm Performance
- Creators: Bates, Thomas
- Creators: Budolfson, Arthur
- Creators: Dooley, Kevin
- Creators: Du, Fangfang
Description
By matching a CEO's place of residence in his or her formative years with U.S. Census survey data, I obtain an estimate of the CEO's family wealth and study the link between the CEO's endowed social status and firm performance. I find that, on average, CEOs born into poor families outperform those born into wealthy families, as measured by a variety of proxies for firm performance. There is no evidence of higher risk-taking by the CEOs from low social status backgrounds. Further, CEOs from less privileged families perform better in firms with high R&D spending but they underperform CEOs from wealthy families when firms operate in a more uncertain environment. Taken together, my results show that endowed family wealth of a CEO is useful in identifying his or her managerial ability.
ContributorsDu, Fangfang (Author) / Babenko, Ilona (Thesis advisor) / Bates, Thomas (Thesis advisor) / Tserlukevich, Yuri (Committee member) / Wang, Jessie (Committee member) / Arizona State University (Publisher)
Created2018
Description
With many recent events, such as the 2008 Financial Crisis, still under heavy scrutiny from the public, the payment received by executives at some of the major US banking institutions has been at the center of a major debate: are bank executives overpaid? While many people have attempted to answer this question, it is important to look at historical data and determine whether banks tie executive pay to the performance of the firm. The authors gathered historical 10-K data on firm performance at five major banks (Bank of America, Citigroup, JP Morgan, US Bancorp, and Wells Fargo), as well as Proxy Statement data on how top-5 executives were being paid at these banks. Correlations between how the firm performed during a given year and what the executive officers of the bank were paid were calculated, to see whether the two subjects correlated with one another. Results were mixed-certain banks drew large correlations between the pay of executives and firm performance, while other banks did not. Interpretation of such data leads to a belief that some banks rely on overall firm performance when setting pay packages for executives, while other banks do not, perhaps using internal measures of performance unknown to the public. Extensive further research could be conducted on this issue to determine what other measures might play a more prominent role when it comes to deciding pay for executives at big banks.
ContributorsScheven, Tyler (Co-author) / Mayer, Robert (Co-author) / LePine, Marcie (Thesis director) / Budolfson, Arthur (Committee member) / Sampedro, Louie (Committee member) / Barrett, The Honors College (Contributor) / Department of Finance (Contributor) / Department of Management (Contributor)
Created2013-05
Description
Firms have increasingly taken on the commitment to sustainability due to environmental and social concerns. Environmental and social sustainability can create firm value and social welfare through cost reduction and revenue growth. While indicating a desire to do more, firms face challenges while engaging with stakeholders in their supply chains – suppliers and consumers. Suppliers are key partners to achieve cost reduction while customers can be the driver for revenue growth. If firms do not overcome the challenges properly, such a win-win situation of both firms and their supply chain stakeholders may not exist. This dissertation aims to understand and suggest ways to overcome the challenges which firms and their supply chain stakeholders face while collaboratively pursuing sustainability.
In the first essay, I investigate the financial impact of a buyer-initiated supplier-focused sustainability improvement program on suppliers’ profitability. The results indicate that a supplier sustainability program may lead to short-term financial loss but long-term financial gain for suppliers, and this effect is contingent on supplier slack resources. The second essay of this dissertation focuses on the consumers and investigates their reactions to two types of firm environmental sustainability claims – sustainable production versus sustainable consumption. The results indicate that firm sustainable consumption claims increase consumers’ purchase, thus leads to larger firm sales, whereas firm sustainable production claims decrease consumers’ buying intention, then result in smaller firm sales. Therefore, I show that, contrary to extant belief, firm environmental sustainability can decrease consumers’ intention to buy. Finally, a firm may be impacted when some of its upstream or downstream stakeholders, or its own operations, are impacted by a natural disaster, which are becoming more frequent due to climate change. In the third essay I study the joint effect of market attention and donation timing on firm stock returns based on the experiences of firms who donated to the 2017 Hurricane Harvey. I conclude that neither the first donors nor the followers can mitigate the negative stock returns due to disasters. However, firms who match their donation timing with market attention experience less negative stock market returns compared to other counterparts.
In the first essay, I investigate the financial impact of a buyer-initiated supplier-focused sustainability improvement program on suppliers’ profitability. The results indicate that a supplier sustainability program may lead to short-term financial loss but long-term financial gain for suppliers, and this effect is contingent on supplier slack resources. The second essay of this dissertation focuses on the consumers and investigates their reactions to two types of firm environmental sustainability claims – sustainable production versus sustainable consumption. The results indicate that firm sustainable consumption claims increase consumers’ purchase, thus leads to larger firm sales, whereas firm sustainable production claims decrease consumers’ buying intention, then result in smaller firm sales. Therefore, I show that, contrary to extant belief, firm environmental sustainability can decrease consumers’ intention to buy. Finally, a firm may be impacted when some of its upstream or downstream stakeholders, or its own operations, are impacted by a natural disaster, which are becoming more frequent due to climate change. In the third essay I study the joint effect of market attention and donation timing on firm stock returns based on the experiences of firms who donated to the 2017 Hurricane Harvey. I conclude that neither the first donors nor the followers can mitigate the negative stock returns due to disasters. However, firms who match their donation timing with market attention experience less negative stock market returns compared to other counterparts.
ContributorsCheng, Feng (Author) / Dooley, Kevin (Thesis advisor) / Han, Sang-Pil (Committee member) / Polyviou, Mikaella (Committee member) / Arizona State University (Publisher)
Created2020