Impact of Unexpected Departure of the CEO

This paper aims to understand the impact of the departure of CEOs on the share prices of companies. It includes a literature review, research methodology, data analysis, and conclusion.

Running head: DEPARTURE OF A CEO
Impact of Unexpected Departure of the CEO
Name of the Student:
Name of the University:
Author’s Note:

1
DEPARTURE OF A CEO
Abstract
The current paper has the intention of creating an understanding of the impact that occurs on the
share price of the companies on the departure of the CEOs. The CEOs have played a significant
role and therefore their performance determines the extent of profitability and the efficiency of
the companies. The background of the paper has been helpful in the development of the
understanding of the performance of the companies and the effect departure of the CEOs have on
the share prices of the companies. The problem statement addresses the issues that are existent
with the help of which analysis can be made with the help of which analysis can move forward.
The literature review of the paper has been looking to address the issues that have been
highlighted by the other researchers. The methodology of the paper has highlighted the kind of
data that would be taken into account with the help of which analysis process can be understood.
The analysis that has been done has been competent in creating the result that was desired and
the results indicate that performance of the companies are impacted with the departure of the
CEOs.

2
DEPARTURE OF A CEO
Table of Contents
Chapter 1: Introduction....................................................................................................................5
1.1 Background of the Study.......................................................................................................7
1.2 Statement of the Problem.......................................................................................................9
1.3 Research Aim.......................................................................................................................10
1.4 Research Objectives.............................................................................................................10
1.5 Research Question...............................................................................................................10
1.6 Research Hypothesis............................................................................................................10
Chapter 2: Literature review..........................................................................................................12
2.1 Introduction:........................................................................................................................12
2.2 Brief overview and hypothetical scenarios of the organisations:........................................12
2.2.1 Samsung:.......................................................................................................................12
2.2.2 Apple:...........................................................................................................................13
2.2.3 Volkswagen:.................................................................................................................13
2.2.4 Audi:.............................................................................................................................14
2.3 Background:.........................................................................................................................14
2.4 Impact on ex-ante day:.........................................................................................................14
2.5 Impact on announcement day:.............................................................................................15
2.6 Impact on ex-post day:.........................................................................................................16
2.7 Signalling:............................................................................................................................17

3
DEPARTURE OF A CEO
2.8 Reactions of the shareholders:.............................................................................................18
2.9 Empirical review:.................................................................................................................19
2.10 Conceptual framework:.....................................................................................................27
2.11 Summary:...........................................................................................................................27
Chapter 3: Research Methodology................................................................................................29
3.1 Introduction..........................................................................................................................29
3.2 Justification of the selection of the methodology................................................................29
3.3 Research Philosophy............................................................................................................30
3.4 Research Approach..............................................................................................................30
3.5 Research Design..................................................................................................................31
3.6 Quantitative Data.................................................................................................................32
3.7 Kind of Data Used...............................................................................................................33
3.8 Data Collection Process.......................................................................................................33
3.9 Data Analysis Plan...............................................................................................................34
3.10 Ethical Consideration.........................................................................................................34
Chapter 4: Data Analysis and Discussion......................................................................................36
4.1 Introduction..........................................................................................................................36
4.2 Data Analysis:......................................................................................................................37
4.3 Findings:..............................................................................................................................53
4.4 Summary of the result..........................................................................................................57

4
DEPARTURE OF A CEO
Chapter 5: Conclusion, Recommendation and Future Work.........................................................59
5.1 Conclusion...........................................................................................................................59
5.2 Addressing the objectives....................................................................................................61
5.3 Recommendation.................................................................................................................62
5.4 Future Work.........................................................................................................................62
Reference List................................................................................................................................64
Bibliography..................................................................................................................................74

5
DEPARTURE OF A CEO
Chapter 1: Introduction
There has been several debates with respect to the existence and the role of the CEOs and
CFOs in the companies. The latest financial crisis and the criticism that has been given with
respect to the payment to the top level executives in the companies have led to the creation of the
question as to whether CEOs and CFOs are able to add in value to the organizations where they
work. It needs to be taken into consideration with respect to whether contributions to the CEO
and CFO towards the value of the shareholders is sufficient to offset the salaries that is earned by
the top level executives (Zhang and Qu 2016). This has been a question that has been very much
a general topic for several years. One of the way with the help of which investigation can be
done with the help of which the changes in the value of the company with respect to the change
in the CFO and the CEO can be determined. The financial theories recommends that the value of
a company is positively or negatively affected when the estimated cash flows of the company
may rise or decline or their systematic risks may rise or fall. This paper would therefore
concentrate on the relationship among the CEO succession and the reaction of the market
through the assessment of the force that leads to these changes.
The examination of the impacts of the top level management turnover and the
declarations of the succession events over the stock prices has been found to be a way to create
an insight into the fact that whether the top level management in an organization have an impact
on the performance of the companies (Quigley, Crossland and Campbell 2017). There have been
researches that have been undertaken earlier which have concentrated on the CEO. However,
along with the CEO, there are other executives as well who has a significant role to play in the
creation of key decisions for the company and these decisions are even likely to have an impact
on the performance of the companies. However, as the CEO is the main personnel for an

6
DEPARTURE OF A CEO
organization, the research would be based on the CEOs and thereafter a comparison would be
made among various companies in order to have an idea about the impact departure of the CEO
have on the stock and shares of the company.
It is seen that most of the companies are not managed by the owners of the company or
the shareholders but by a leader like the CEO and even by the team of the other officers. The
CEO is known to be responsible to the shareholders of the company with the help of the elected
representatives who have been known to be the Board of Directors. The CEOs are primarily
accountable for the major choices of the firm policies, the strategy of the company and other kjey
decisions (Garg, Li and Shaw 2018). If the companies are able to survive the long enough, they
would automatically observe the succession. After various researches, the authors have not
discovered the consensus on the question whether the leaders would make a difference.
However, it has led to the creation of the focus on addressing the scenarios under which it is
more or less possible for the new CEOs to have an influence on the organizational results.
Therefore, succession of the CEO is the central issue in the organization theory. CEOs may be
known to be different with respect to the job of the CFOs but it is seen that most the CEOs have
the ability to replace the former. There have been several issues that had an impact on the
performance of the companies. It is seen that companies like Enron faced issues in the economy
mainly due to the accounting quality of the company (Randøy, Strøm and Mersland 2015).
Therefore, the role of the CEO has a significant role to play with the help of which the
accounting decisions and quality can be maintained with the help of which better performance
can be attained. Hence, this research would look to assess and discover the impact of the
departure of the CEOs on the stock prices of the companies.

7
DEPARTURE OF A CEO
1.1 Background of the Study
There are thousands of employees who are working in various companies and many of
them are senior management leaders. It is vital to create and understanding of the dynamics that
are associated with the changes in the top leaded and the impact on the senior management
teams. The companies that are functioning in the economy acts as a sociological aspect and
therefore any kind of issues and problems in efficient management can lead to issues and
problems that are social in nature as many employees are employed in these companies (Driver
and Guedes 2017).
Any kind of disruptions and loss of jobs for the local community or reduction in the level
of services to the citizens of the region would lead to dissection among the community. It is seen
that CEOs have a key role to play in the development of a company. The other essential aspect of
the company has been the movement of their share prices. The movement of the share prices of a
company in the market would determine the extent of efficiency and the performance of the
companies. The positive share price motivates the investors to undertake investment in a
company. However, it is seen that the role of the CEO is some way related to the movement in
the share price as well as it is seen that the performance of the companies is on the basis of the
decisions and the plans and policies that have been constructed by the management and the CEO.
The departure of the CEO as well as the succession of a CEO can therefore have an impact on
the share price as well. Krenn (2017) addressed the fact that each personnel have their own style
of managing a business and therefore once there is a change in the management, it would have an
impact on the operational activity as well on the brand image of the company.
There have been several researches that have been undertaken that is useful for the
development of an idea with the help of which better results can be undertaken. Most of the

8
DEPARTURE OF A CEO
researches have determined the fact that there are significant amount of impact on the
performance of the shares once there has been a change in the CEO. The changes can be either
positive or negative in nature. The change would be dependent on the traits of the earlier CEO
and the CEO who has succeeded in the company. It is due to this fact that assessment on this
topic becomes vital (Harjoto, Laksmana and Lee 2015). It is even seen that management style
and the leadership skills of the CEO plays a fundamental role with the help of which better
performance for the companies can be ascertained.
The other impact that the CEOs have on the performance of the companies have been the
turnover rate in the companies. The extent of turnover is dependent on the level of motivation
that is existent among the employees due to the policies and the plans that have been
incorporated by the company. When a company has satisfied employees, the degree of
performance and the quality of performance becomes better (Demirtas and Simsir 2016). On the
other hand, dissatisfied employee would determine that the performance of the company is not
efficient and therefore this would have an impact on the performance and therefore would have
an impact on the share prices as well.
The extent of change in the share price is dependent on various factors and one of them
has been the impact of the CEO. There are several instances where it is seen that image of the
CEO addresses the share price of the stocks. The investors as well as the shareholders look
determine the image of an organization on the basis of the image of the CEO. Hence, there has
been vast changes in the share prices once a CEO retires or expires and a new CEO is coming in
that position (Bouaine et al. 2015). In case the transition is managed in an effective manner, then
the chances of negative results become low and in case the transition is not effective then it may
lead to the negative results.

9
DEPARTURE OF A CEO
The aspects of stress, fear and the transformations that are taking place at the time of the
organizational transition are some of the essential elements that are seen within the organization.
The management of ambiguity and the aspect of staying flexible and being agile are the
characteristics that would help the senior managers to effectively work at the time of the scenario
when transition of a new CEO is taking place. Therefore, it can be stated that this topic is an
essential one and research on the same in the current time period would be helpful in the
determination effect on the share price with the departure of a CEO. In this paper, analysis and
comparison would be done by taking two companies from the automobile industry and two
companies from the technological industries (Wang and Yang 2015). A comparison and
assessment would be done in order to find out the changes it can take place. The companies and
their share prices that have been taken into consideration in this paper are Apple Inc and
Samsung for technology industry and Volkswagen and Audi from the automobile industry.
1.2 Statement of the Problem
In the current time period, it is seen that external finance from the market and the
economy has a fundamental role to play and therefore most of the companies issue shares in
order to collect money from the market. It is due to this fact that movement of the share prices
have a key role to play with the help of which better performance of the company can be
understood. One of the factors that have an impact on the performance of the shares of a
company has been the traits and the departures of the CEO (Lim and Love 2017). CEO being the
top of the management has the responsibility to take all the decisions related to the company and
therefore departure of the CEO would have an impact on the share as well. It is due to this fact
that research on this topic would be done with the help of which changes in the share price of the
selected companies would be determined.

10
DEPARTURE OF A CEO
1.3 Research Aim
The aim of the research has been the aspect and the agenda that would be taken into
consideration with the help of which better results in accordance to the topic can be understood.
Hence, aim of the topic has been to determine how the departure of a CEO of a company has an
impact on the prices of the shares.
1.4 Research Objectives
The objectives are constructed on the basis of the aim of the research and therefore the
objectives of the research has been given as follows:
 Determining the reaction of the market with respect to the departure of a CEO towards a
company
 Ascertaining the level of change in the stock price with the departure of a CEO of a
company
1.5 Research Question
The research question would constitute of the questions that would be answered with the
help of which completion of the paper is possible. Therefore, the research question in accordance
to this topic has been given as follows:
Q1. How does the market react to the announcement of a CEO departing from a company?
Q2. How does the departure of a CEO have an impact on the share prices of a company?
1.6 Research Hypothesis
The hypothesis constitutes of the elements that has to be answered by the company. The
hypothesis of the research has been given as follows:

11
DEPARTURE OF A CEO
Hypothesis 1:
Null hypothesis (H0): The average close prices of ‘Apple’ after and before of medical leave of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Apple’ after and before medical leave
of CEO are unequal.
Hypothesis 2:
Null hypothesis (H0): The average close prices of ‘Samsung’ after and before of resignation of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Samsung’ after and before recognition
of CEO are unequal.
Hypothesis 3:
Null hypothesis (H0): The average close prices of ‘AUDI’ after and before arrest of CEO are
equal.
Alternative hypothesis (HA): The average close prices of ‘AUDI’ after and before arrest of CEO
are unequal.
Hypothesis 4:
Null hypothesis (H0): The average close prices of ‘Volkswagen’ after and before removal of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Volkswagen’ after and before removal
of CEO are unequal.

12
DEPARTURE OF A CEO
Chapter 2: Literature review
2.1 Introduction:
A variation in share price when the CEO of an organisation makes an unexpected
departure could modify based on a variety of factors. Majority of these factors depend on the
market perceptions of the capability of the temporary CEO of taking the organisation forward.
Irrespective of whether the change is planned or arising out of unexpected conditions, the way
the stock performs depicts partly the ability of the organisation in managing the transition
(Aguinis et al. 2018). Sudden departure of CEO has greater downside risk in contrast to upside
risk and the risk is increased in case of unplanned transition. This is because of the chance that
the new or temporary CEO might shift corporate strategy for the worse. The transition
management and the new CEO agenda are significant influential dynamics for the investors to
take into consideration.
The current chapter would shed light on the various factors affecting the share prices of
the organisations due to the sudden departure of CEOs. For better evaluation of the factors,
hypothetical examples have been formulated so that the effect on share price of the organisation
could be identified effectively. Four companies have been taken into consideration that constitute
of Samsung, Apple, Audi and Volkswagen Group. Thus, the share price reactions of the
investors would be evaluated effectively by the unplanned departure of the CEOs of the four
organisations.
2.2 Brief overview and hypothetical scenarios of the organisations:
2.2.1 Samsung:
Samsung Electronics along with its subsidiaries is involved in consumer electronics,
mobile communications and information technology and device solutions businesses in the

13
DEPARTURE OF A CEO
global arena. It offers monitors, digital televisions, wearables, tablets, phones and accessories,
computers, communication systems, memory as well as system LSI products (Samsung uk
2018). At present, the organisation has three CEOs, which are Kim Hyun Suk, Koh Dong Jin and
Kim Ki Nam. For this study, it is assumed that the CEOs of the organisation have stepped down
from their position due to engagement in politics with the Prime Minister/President of South
Korea.
2.2.2 Apple:
Apple Inc is a multinational organisation developing consumer electronics, commercial
servers and computer software. The popular hardware products of the organisation constitute of
Macintosh Computers, iPhone, iPad and iPod. The primary goal of Apple is to gather stellar
products and services within the stipulated time at a cost reflecting the maximum value to
customers as well as shareholders (Apple United Kingdom 2018). The chief executive of Apple
is Steve Jobs and he is the most charismatic businessman in the world at the present date. In case
of Apple, it is assumed that the CEO of the organisation has departed on long medical leave.
2.2.3 Volkswagen:
Volkswagen is one of the leading global automobile manufacturers and one of the biggest
car makers in Europe. The organisation aims to increase its focal point on foundation business,
minimise cost of product and enhance profitability (Volkswagen.com 2018). In order to assure
the accomplishment of these goals, the organisation is considering a range of planned as well as
innovation of business like divesture of non-core business segments along with preface of new
models. Herbert Diess is the chairperson of Volkswagen and it is assumed that the CEO of the
organisation has left due to the emission case recently.

14
DEPARTURE OF A CEO
2.2.4 Audi:
Audi is a German manufacturer of automobiles, which is involved in designing,
engineering, manufacturing, marketing and distributing luxury vehicles (Audi.com 2018). The
organisation operates through manufacturing and automobile segments. It is involved in
providing premium automobiles, super SUVs, supercars and super motorcycles. The current
CEO of the organisation is Rupert Stadler, who has to leave unexpectedly from the organisation
due to the recent emission issue and this is considered as the hypothetical situation.
2.3 Background:
Primarily, five internal events affect the share prices, which include financial reports,
mergers and acquisitions, approval or development of new innovative product, announcements
related to changes in dividend policy along with firing or hiring company executives. The change
of top management like CEO would bring unexpected variation on the stock price performance.
The previous studies could be categorised into five significant parts, which are impact on ex-ante
day, impact on announcement day, impact on ex-post day, signalling and reaction of the
shareholders (Andreou, Louca and Petrou 2017).
2.4 Impact on ex-ante day:
In the field of study, the scholars concentrate on the departure announcements of the
CEO and share prices by examining cumulative abnormal returns over a year. The cumulative
abnormal returns denote the daily additional stock returns in opposition to the market returns for
a specified timeframe. According to the research work of Andreou, Louca and Petrou (2017),
1,187 successions of CEO have been conducted and it has been found that the investors have
revised their expectations, in which the stock prices of the organisations fell by an average of 1%
during pre-announcement period and the decline was further by additional 3.5% during the post-

15
DEPARTURE OF A CEO
announcement period of 50 days. In case of the four stated organisations, the share prices of
these organisations is expected to fall sharply by the sudden departure of CEOs, as the
shareholders might have to revise their expectations.
2.5 Impact on announcement day:
The corporate news about the sudden departure of a CEO or an appointment of a
temporary CEO is declared simultaneously. As a result, it has caused positive or negative price
influences for such changes confronting the announcement day (Baker and Xuan 2016). It has
been observed that there is existence of negative correlation between the departure of a CEO and
the stock price of an organisation. In addition, it has been analysed that more than 30% of the
CEO departures have been declared at the same time with disclosure of earnings and other
significant economic news affecting share prices (Bargeron et al. 2017).
The following study of the four chosen organisations demonstrates two effects related to
the announcement of changes in management. The first probable effect on these four
organisations is from the informational perspective. This could be adverse, if the change implies
that the performances of the organisations are worse in contrast to the market realisations. The
other effect would be the real effect and this would be favourable, if the variation is in the
interest of the shareholders. In case of the four organisations, the dividend issues need to be
eliminated from sample data, the departure of CEO might provide greater returns in contrast to
the departures of the other senior management representatives.
Another research work conducted by Boivie, Graffin and Gentry (2016) was associated
with testing 269 AMEX and NYSE organisations between 1963 and 1978 for stock performance
and changes in top management. The performances related to daily abnormal returns seem

16
DEPARTURE OF A CEO
unimpressive response to the variations. Hence, for the four selected organisations, it could be
stated that the performance of monthly abnormal returns after the sudden unexpected departure
of CEO could not validate that market reaction has direct association with the declaration of
change in management.
In the research work of Brown et al. (2017), a study was conducted on a specific area of
sudden departures of company CEOs. 53 such surveys were conducted, in which the CEOs of the
organisations had made unexpected departures from their respective organisations. The empirical
outcomes reveal that the normal excess returns do not differ statistically from zero and after this;
standardised excess return dispersion had been added for the declaration period. Finally, the
results extend support to the notion regarding the association between adjustments in share prices
and unexpected departures of CEOs. For Apple, Samsung, Volkswagen and Audi, similar
outcomes could be expected, as there might not be significant statistical deviations for the
normal additional returns (Bennett and Wang 2018).
2.6 Impact on ex-post day:
After the announcements of the CEOs of the four above-stated organisations, some
scholars and investors would pay considerable heed to the post announcements. The efficient
market hypothesis states that the share market makes reactions to the changes promptly and
rationally. As pointed out by Chyz and Gaertner (2017), the additional returns of post
announcements of sudden CEO departures perform weaker in contrast to those confronting the
pre-announcement and the announcement day. Five time horizons could be formed and they are
to be differentiated for testing cumulative daily additional returns, out of which the initial two
time horizons have been explained previously. From the third and the fourth horizons,
considerable as well as positive correlation could be observed between the characteristics of the

17
DEPARTURE OF A CEO
CEOs and abnormal returns that could be distinguished from each other for the four
organisations. However, the performance is expected to be weak in the fifth time horizon.
2.7 Signalling:
The replacement of the CEO of a firm carries a message for the general public (Conyon,
He and Zhou 2015). Such replacement could be termed as human capital, which is obviously
special and it highlights the existing outstanding performance of the organisation along with its
future prospects. The unexpected departure of a CEO having considerable ownership of shares
might signify a rise in the profitability of an acquisition and this might result in positive
adjustment in share price (Cummings and Knott 2017). However, according to the evidences
gathered, the organisations experience modest adverse share price reaction to the sudden
departure of the CEOs. This situation could be similar in case of the chosen three organisations,
as they are likely to expect adverse share price reaction, if their CEOs make sudden departures.
According to Crossland et al. (2014), there would be two likely actions, if there are
unexpected departures of CEOs from the business organisations. The first action would be that
the four organisations might undertake earnings baths in an enhanced performance. This signifies
the skills of the executives are approved in the reports of earnings through company operations.
The second action is that the relation between the responses of the four organisations to the
improbable environment and its features to look for new top CEOs. If the CEOs could not
accustom with the changing conditions, it is a matter of time that they would not be retained
further in their organisations (Deb and Wiklund 2017). However, the scenario might not be the
same for Samsung, Apple, Volkswagen and Audi, as the empirical outcomes reveal different
stories. It has been found that the external changes cause positive abnormal returns rather than

18
DEPARTURE OF A CEO
changes in CEOs. According to the study of Driver and Guedes (2017), no considerable effects
on the share prices of the organisations have been found in case of sudden CEO departures.
In addition, the researchers have conducted a study to understand the relationship
between the sudden departures of CEOs and the share prices in distressed firms through the
employment of cross-section hypothesis. Three factors have been initiated for explaining such
hypothesis and the successor’s origin is one of them. The null hypothesis stated that the
appointment of a new CEO brought adverse impact on stock performance. A reason identified is
that signal is provided to the investors that the organisations require employing more qualified
CEOs from the external world. However, this might not be applicable for Apple and Samsung, as
the departures of their CEOs might have adverse impact on the attitudes of the investors and it is
highly probable that they would experience drastic decline in their share prices in the global
markets.
2.8 Reactions of the shareholders:
The wealth of the shareholders has tight association with the value of a business entity.
All the movements that the firm makes attract direct attention to the shareholders. More
precisely, the sudden departures of CEOs provide poor signals to the market, as it implies that
the business cycles of the organisations are on the declining scale (Eckbo, Thorburn and Wang
2016). However, there have been certain past researches on this issue, which have exposed
divergent inferences.
The sudden departures of the CEOs were depicted in positive stock retains, if the
shareholders could make additional favourable wealth. In opposition, the depictions have been
made in adverse outcomes. Two situations have been taken into consideration, which include

19
DEPARTURE OF A CEO
incumbent employment and discontinued employment (Faccio, Marchica and Mura 2016). Even
though the first employment might provide negative effects on the wealth of the shareholders of
the four organisations, the latter employment might result in positive consequences. This is
particularly true in case of Volkswagen and Audi, as their CEOs have made sudden departures
due to the recent emission issue. Hence, it could be said that is highly troublesome to describe
the contradictory results.
According to the research study of Gao, Harford and Li (2017), a survey was conducted
on the effects of management changes on the wealth of the shareholders. In this study, 498
declared management changes from the common equity organisations have been taken into
account between 1972 and 1983. The management changes have been segregated into two
groups depending on the instigated internal and external sources. This had helped in figuring the
share price reactions for managing changes whether from externally or internally instigated.
When these two groups were used for hypothesis testing, the results implied variance abnormal
returns. The returns had been observed to be negatively abnormal at the time corporate power
internally instigate these changes. However, there was absence of abnormal returns at the time of
sudden departures of the CEOs. In case of Samsung and Apple, the departures of the CEOs are
deemed to be voluntary and hence, no significant abnormal returns are expected to crop up for
the organisations. On the other hand, in case of Volkswagen and Audi, the departures were due
to internal instigations and hence, adverse impact is deemed to be observed on the share prices of
these two organisations.
2.9 Empirical review:
It has been argued that the conflicting outcomes of the past researchers on the impact of
unexpected CEO departures on the stock prices depict the information effect as well as the real

20
DEPARTURE OF A CEO
effect on the declaration of change in management. There would be potential negativity in the
information effect; in case, the declaration of the sudden departure of a CEO implies that the
difficulties of the organisation have been far more than the market expectations. A positive real
impact is the actual favourable influence of a change made in the interests of the shareholders.
The individual magnitudes of the two influences in all circumstances associated with
management change would result in varying outcomes for every incident of change in
management (Geertsema, Lont and Lu 2016).
This argument has been supported further by numerous scholars about the effect of
information, as they consider a significant aspect of CEO departure declarations to be the signal
that the market is yet to receive. For Apple, Samsung, Volswagen and Audi, the CEOs have been
privy to information, which are not available publicly and any departure in this rank might
deliver a message about the existing or future status of the organisations. The reaction of the
market might be positive, negative or it might remain the same even after the receipt of the
signals. Various explanations have been put forward for the impact of the stock market on the
declaration day of the change in the CEO of a business organisation. The adverse reaction could
be due to the outcome of the negative short-term impact of a new CEO, as in the case of
Volkswagen and Audi. The distraction to the main business of the organisation is the outcome of
the adverse effect, the new period of adjustment of the CEO and probable restructuring of the
management team (Hou, Priem and Goranova 2017).
There is highly chance that the adverse impact of the declaration is because of the excess
information that has been provided to the market. This reason could be linked with the case of
Volkswagen and Audi, as they were associated with the recent emission issue leading to the
sudden departure of the CEOs. If there is no awareness of the market regarding the significance

21
DEPARTURE OF A CEO
of the difficulty level that the organisation has experienced, the declaration of the sudden CEO
departure might provide signal to the market that the organisation is in additional trouble than the
expectations and the future performance of the organisation is likely to be hampered. This
situation could be associated with the case of Samsung and Apple, as their CEOs have been
highly efficient in managing the business activities. Hence, their departures might lead to sudden
downfall in the stock market, which is way beyond the expectations of the market (Intintoli,
Serfling and Shaikh 2017). Such excess information would then be shown in an adjusted stock
price for the organisation. The positive impact of the market could be attributed to the hypothesis
that the Board of Directors of the organisation are recognised by the market in a manner that
maximises the wealth of the shareholders.
A research on the effect of the sudden departures of the CEOs on the financial condition
of a business entity assumes that the decisions of the organisations are influenced highly by their
CEOs. This is evident in case of Apple and Samsung, as their CEOs play active role in all annual
board meetings and their views are provided utmost importance by the management. In this
context, Jenter and Kanaan (2015) advocated that the greater discretion levels provided to the
CEOs on the part of the Boards of Directors raise their ability of directly affecting the
organisational performance. Thus, it could be said that managerial discretion is the notion that
strategic leadership, embodied in the CEO role, is critical to the success of the organisation.
Greater managerial discretion and the related increased riskiness of the role of the CEO result in
higher potential impact of the CEO on the organisation. This situation is true for all the four
organisations, as the opinions and judgements of the CEOs are provided with considerable worth
and attention.

22
DEPARTURE OF A CEO
A favourable effect on organisational performance of a change in CEO needs that the
Board of Directors has the capability of realising and attracting a superior successor. However,
the researches carried out on the outcomes of such replacements have failed to achieve
consistency (Jenter and Lewellen 2015). The sudden departures of the CEOs have direct impact
on the levels of initial share prices along with subsequent performance of the organisations. The
researchers have found positive stock market reactions when the departures of the CEOs could
not be estimated by the market. This situation is similar to Apple and Samsung, as the market
could not realise that the CEO of Apple would be on long-term medical leave and the CEO of
Samsung would be engaged with the politics of South Korea. However, it could be argued that
the estimated events are priced already in to the existing stock price of the affected organisation.
Another research work conducted by John Harry III et al. (2017) stated that the reactions
of the shareholders are deemed to be positive if the performance of the prior firm is not effective
and the initiation of the succession was made by the CEO or the Board. On the other hand, if the
performance of the prior firm is effective, negative reactions are deemed to be observed in the
share price of the concerned organisation. An unexpected departure of a CEO leads to a
minimisation in the share price of an organisation. In case of Apple and Samsung, the
performance of the prior firms has been highly effective and thus, negative stock market
reactions are bound to be obvious for them. The market is observed to place emphasis on
succession planning in case of poor prior performing firms, since uncertainty would be
minimised and this denotes that the role of the CEO is observed to add value. According to
Jenter and Lewellen (2017), before the departure of a CEO, decline in performance was
encountered, with improvement after the appointment of the new CEO. This denotes a rise in
operational performance as well as managerial quality. The situation is similar for Volkswagen

23
DEPARTURE OF A CEO
and Audi, as they have been performing poorly in the stock market due to the emission issue.
However, after the appointment of the new CEOs, improvements could be witnessed in the share
prices of these organisations.
Even though the market provides short-term adverse reactions to the declaration of a
change in CEO, the change in the long-term is observed as positive. This is relied on the
assumption that the competency of the CEO is well meeting the desired standards and the
individual has the capability of enhancing the organisational performance with the passage of
time (Jönsson and Tarukoski 2017). Thus, it could be said that where the declaration of a change
in CEO leads to adverse market reaction in short-term, often the market fails to perceive the
long-term benefits by the appointment of the new CEO. This validates the fact that in cases of
Samsung and Apple, even if the stock market reactions would be negative initially, the changes
in the CEOs would eventually fetch long-term benefits to the shareholders. The theory relating to
the succession of CEO is unclear and estimations of share price reactions to turnover events are
ambiguous (Khanna, Kim and Lu 2015).
It has been argued that if the new CEO turns out to be superior to the departed CEO,
improvements could be seen in stock price reactions in future. However, it is to be borne in mind
that if the change of a CEO is due to past ineffective management decisions, this might lead to a
minimisation in the share price; in case, the market is fully aware of the degree of poor
management decisions. The reactions of the share prices at the date of declaration depict the
estimated results of departures; however, the real results could be witnessed only with the
passage of time (Kim, Wang and Zhang 2016). Since the situations of Apple and Samsung are
considered to be hypothetical, the outcomes of the sudden departures of their CEOs could be
known only with time.

24
DEPARTURE OF A CEO
Numerous researches have been carried out to find whether external or internal
successors to the leaving CEOs are more effective. The appointment of an insider could be taken
into account in the form of a maintenance strategy, while the appointment of an outsider is taken
into account in the form of a fundamental change to the operations as well as priorities of the
organisation. According to Krause, Semadeni and Cannella Jr (2014), insider recession is
observed to signal maintenance strategy to conduct the business operations of the organisation,
while external replacement implies significant changes might take place within the organisation.
For few performance measures, the turnover of CEO fetched favourable outcomes, when an
insider replaces the CEO, as were in the cases of Audi and Volkswagen. It is an established fact
that for sudden departures due to normal retirement or ill-health, the successor is probable to be
an internal individual, as would be in the case of Apple, since its CEO is supposed to go on a
medical leave for long-term due to ill-health.
According to a survey carried out by Lim (2015), it has been found that maximum
organisations have preferred for internal CEO replacements. On the other hand, when the CEOs
are replaced externally, favourable stock price reactions could be observed. This is because
internal replacements would lead to little reactions (Liu, Liu and Luo 2016). In case of sudden
departure of CEO due to signing up with political forces, the declaration of an external
replacement leads to minimisation in the value of equity. This might hold true in case of
Samsung, as its CEO is assumed to join the political party with the current Prime
Minister/President of South Korea.
However, according to the research study of Pan, Wang and Weisbach (2016), it has been
observed that the reactions of the shareholders to an external replacement is highly favourable in
contrast to an internal replacement and this is highly significant; in case, the replacement takes

25
DEPARTURE OF A CEO
place from an associated industry. This is analysed as a replacement factor from within the sector
expected estimated to bring radical changes with rapidity. An external CEO is estimated to have
a new approach; however, the individual might possess no knowledge of the organisation or
sector and hence, additional amount of time might be needed before undertaking the needed
modifications. As commented by Quigley, Crossland and Campbell (2017), favourable
shareholder reactions have been observed in case of external successors. The previous studies
stated that prior ineffective organisational performance did not result in an outside successor.
The appearances of the external successors take place only in the midterm of the organisational
outcomes. This implies that in situations of extreme performance, which might be either
favourable or unfavourable, an internal successor might prove to be less risky. Hence, Apple and
Samsung need to look for internal successors, as the external CEOs might not have adequate
knowledge about the business operations and activities of the two organisations.
In the words of Pan, Wang and Weisbach (2015), internal succession is related to
improved organisational performance. This has been consistent with the statement that internal
succession is not much disruptive and it is less probable to lead to poor performance of the
business entity. On the other hand, according to the outcomes of another research work
conducted by Rivolta (2018), it has been found that there were not considerable variations in
reactions between the declarations made about inside or outside replacement. Hence, in terms of
the four chosen organisations, the stock market reactions might be favourable or unfavourable
regardless of whether the CEO successions are made internally or externally.
In the research study of Schoar and Zuo (2016), the likelihood of the turnover of the top
five executives after the departure of CEO of an organisation is found to be greater in contrast to
the situation when there is no departure of the CEO. This is highly inherent in organisations, in

26
DEPARTURE OF A CEO
which the successor is likely to be externally appointed. This implies a nature of the team to the
departures of the management. The outcomes of the past research have not been consistent at the
time of investigating the impact of internal replacement in contrast to external replacement of
CEO, even when the impact of pre-succession performance of the firm has been controlled. This
could be described as the market analysing the signals related to turnover. This holds true for all
the four organisations despite their controls on pre-succession performances.
The impact of share price on the sudden departures of the CEOs changes due to various
causes of departures. It has been found that in instances of normal retirement, the performance of
the organisation does not decline before the declaration of the change, in which the measurement
of performance is carried out by operating profit to total assets. A considerable rise in
performance could be observed with the passage of time.
According to Wang, Zhao and Chen (2017), there has been negative reaction of the share
price on the sudden departures of the CEOs because of disability. In case of normal CEO
replacements, the responses of the market have been favourable to a declaration, in which there
has been permanent replacement. This has been the case with Audi and Volkswagen, as they
have replaced their CEOs due to the emission issue. The declarations of terminations in the
absence of additional information have been observed to cause no market responses. The
previous researches evaluated that majority of the CEO successions occur with the successors
that have been identified in advance and the proposed successors are then placed in the positions.
However, unplanned and poorly managed CEO successions have adverse impact on the wealth
of the shareholders. This has been the case with Apple and Samsung, since their CEO
successions are not deemed to be planned and this might have adverse impact on the stock
market, as the wealth of the shareholders might not be maximised.

27
DEPARTURE OF A CEO
2.10 Conceptual framework:
Conceptual framework is structured from a group of wide theories and ideas, which
enables a researcher to identify the issue, frame questions along with finding relevant literature.
In other words, it is a diagrammatic overview depicting the relationship between independent
variable and dependent variable. In this research, the conceptual framework would look at the
impact of the sudden departures of the CEOs on the share prices of the business organisations.
The independent variable for this research is the declaration of the changes in CEOs and the
dependent variable is performance.
Figure 2.1: Conceptual framework
(Source: As created by author)
2.11 Summary:
In this study, for better evaluation of the factors, hypothetical examples have been
formulated so that the effect on share price of the organisation could be identified effectively.
Four companies have been taken into consideration that constitute of Samsung, Apple, Audi and
Volkswagen Group. Thus, the share price reactions of the investors would be evaluated
effectively by the unplanned departure of the CEOs of the four organisations. Numerous

28
DEPARTURE OF A CEO
researches have been carried out to find whether external or internal successors to the leaving
CEOs are more effective. The appointment of an insider could be taken into account in the form
of a maintenance strategy, while the appointment of an outsider is taken into account in the form
of a fundamental change to the operations as well as priorities of the organisation.
The impact of share price on the sudden departures of the CEOs changes due to various
causes of departures. It has been found that in instances of normal retirement, the performance of
the organisation does not decline before the declaration of the change, in which the measurement
of performance is carried out by operating profit to total assets. A considerable rise in
performance could be observed with the passage of time. In case of normal CEO replacements,
the responses of the market have been favourable to a declaration, in which there has been
permanent replacement. This has been the case with Audi and Volkswagen, as they have
replaced their CEOs due to the emission issue. However, unplanned and poorly managed CEO
successions have adverse impact on the wealth of the shareholders. This has been the case with
Apple and Samsung, since their CEO successions are not deemed to be planned and this might
have adverse impact on the stock market, as the wealth of the shareholders might not be
maximised.

29
DEPARTURE OF A CEO
Chapter 3: Research Methodology
3.1 Introduction
The research methodology is prepared in such a manner so that it is able to answer the
topic in accordance to which this research has been undertaken. The methodology therefore
answers the source and the kind of data that would be used in the paper in order to proceed with
the process of analysis. This would be helpful in the development of the outcome that is
demanded in order to complete the paper in an effective manner. The philosophy, the design and
the approach that has been selected for this paper has even been explained in this chapter so that
all the elements related to this research remains embedded in this paper (Hanssens, Deloof and
Vanacker 2016). This is helpful in the determination of the guideline and the procedure that has
been followed and thereby the perspective of the research is known. The method that is
undertaken in order to collect the data and the plan for analysis is even explained so that the
entire analysis procedure can be initiated in a much better way. In this manner, the impact of the
departure of the CEO on the selected companies would be known in a better way.
3.2 Justification of the selection of the methodology
Tupper (2016) cited that there are two kinds of methodologies that can be used by the
researcher and they are the ones that is used in order to undertake any kind of research. The
methodologies that are being discussed about are quantitative and qualitative research
methodology. The choice of the methodology is always on the basis on the topic on which the
research is being undertaken. Prior to the selection process, assessments and comparisons are
done and thereafter the methodology that is suitable for the paper is taken into consideration. In
this way, in accordance to the topic that looks to understand the impact on the departure of the
CEO, it is seen that quantitative research methodology has been selected as the paper would be

30
DEPARTURE OF A CEO
on the basis of the secondary data that has been collected mainly from the annual report of the
companies that have been selected. The final result is constructed on the basis of the data that is
attained and the evaluation is undertaken on the basis of this data. The quantitative methodology
would undertake a comprehensive assessment of the share prices of the company and
accordingly better and conclusive results can be attained and the completion of the paper is
possible.
3.3 Research Philosophy
The research philosophy is connected with the understanding, assurance and the
knowledge of the systems and the procedure and this is done with the support of the data which
is in relation to the topic. Mukherjee and Nguyen (2018) explained the fact that there are four
sorts of philosophies that are available for use and the one that is associating to the paper is
selected. The three philosophies are realism, interpretivism and pragmatism and positivism
philosophy. It is seen that this paper is looking to understand the impact of the departure of the
CEO and therefore comparison and the evaluation of the share prices of the company before and
the after the departure would be taken into consideration. Hence, positivism philosophy has been
chosen as the data would be compared and explained and accordingly the impact the departure
has on the share prices would be known. This assists in ascertaining a positive outlook and
thereby better and desired results can be known.
3.4 Research Approach
The approach of the research is helpful in the development and the establishment of
better relationship within the framework, models and theories that would be selected with the
help of which valid and accurate outcome of the research would be known. The overall outcome
of the paper would be known and thereby the discovery of the outcome can be known, which can

31
DEPARTURE OF A CEO
be utilised for future references. Back and Kim (2015) explained that there are two kinds of
approaches that can be taken into consideration and it is seen that the one that is ideal for this
paper is selected. The two approaches are inductive approach and deductive approach. The
inductive approach looks to answer and the development of the frameworks and the models that
have not been used earlier would be used and accordingly new models would be framed for the
topic in order to attain innovative outcomes. On the other hand, deductive approach refers to the
theories, frameworks and models that have been constructed previously for other researches and
these models and theories would be helpful for the research that has been taken into
consideration. With respect to the topic of understanding the impact of the departure of the CEO,
it is seen that deductive approach has been selected and therefore the models and the theories
used in other previous researches have been used with the help of which the understanding of the
analysis and results would be known in an effective manner. Inductive approach has not been
selected as due to the constraint of time and the topic that is selected the need of new theories
and framework is not essential. Therefore, it can be ascertained that deductive approach is the
most suitable one for this paper.
3.5 Research Design
The design of the research is related to the framework and the design that has been
followed and accordingly the one that is ideal will be accepted and this would perform as a
guideline for the current paper and this would be helpful in the determination of the desired
outcome. Byrnes and Taylor (2015) has addressed that there are three kinds of designs that are
available for use and they are known to be descriptive research design, exploratory research
design and explanatory research design. The selection of the design is on the basis of the topic of
the paper. It is seen that this topic is looking discover the impact of the departure of the CEO and

32
DEPARTURE OF A CEO
therefore a comparison would be made for the share prices before and after the departure of the
CEOs of the company. It is due to this fact that explanatory research design has been selected
mainly due to the fact that four companies from two industries have been selected and therefore
their share prices would be taken into consideration and thereafter comparison of the same is
possible with the help of which the understanding of the topic is known. Therefore, explanatory
research design is ideal for this paper so that cause and effect relationship of the shares prices of
the selected companies would be known and thereby better and precise result in accordance to
the topic will be known. The disclosure of the design will be helpful in the determination of the
collection process that would be used with the help of which analysis process of the paper would
be known.
3.6 Quantitative Data
With respect to this topic, quantitative data is ideal and therefore has been selected
especially due to the fact that the impact of the departure of the CEO on the share prices of the
company and comparison of the shares can be done with the help of this data. The quantitative
data in accordance to this topic is collected from the share prices of the companies and therefore
numerical facts and figures are considered so that proper idea about the impact can be known and
accordingly future results can be determined (Li et al. 2017). Quantitative data is suitable for this
paper because of the fact that the prices of the shares before and after the departure of the CEO
would be known and effective comparison would be done so that the performance of the
companies and the impact of the departure of the CEOs will be known in a proper way. The data
will be collected with the help of the annual report of the companies and numerical figures will
be compared in order to reach the outcome of the paper.

33
DEPARTURE OF A CEO
3.7 Kind of Data Used
In accordance to the topic, which is looking to understand the impact of the departure of
the CEOs, it is seen that secondary data has been used and hence the data in relation to this topic
has been collected from various resources. Secondary data has been used and therefore this data
is collected from journal articles and reports which have been constructed by several authors and
this data is helpful in creating an understanding of the departure of the CEO. In order to collect
the share prices of the companies that have been selected, internet websites have been used as the
share prices have been collected from company websites and even from the website of the stock
market (Krause, Priem and Love 2015). The annual report of the companies has even been taken
into consideration and hence critical evaluation and analysis of the same has been done in order
to collect the data of the share prices before and after the departure of the CEOs.
3.8 Data Collection Process
The gathering of the data has a crucial role to play because of the fact that if the data is
not collected from valid and authentic sources, the result that would be obtained may not be
effective and false and this would lead to error in the research and the objective of the research
would not be met. The data collection of the data is the process with the help of which
assessment can move ahead. The secondary data in relation to the topic is sourced from the
business articles and magazines that are published on a monthly basis (Bermiss and Murmann
2015). These sources are ideal for ascertaining the precise data for the purpose of analysis. The
annual report of the companies have been used in order to find out the financial scenario of the
companies and the share prices of the companies have been collected from the website of the
stock market and even from the annual report of the companies. The prices of the shares have
been collected with a time frame of before and after the departure of the CEOs and therefore

34
DEPARTURE OF A CEO
critical search have been undertaken. The share prices have been in different currencies and
therefore all the prices have been converted into American dollar so that it becomes easier to
undertake the analysis process. The collected data thereafter became easier in order to proceed
with the analysis process.
3.9 Data Analysis Plan
The assessment plan determines the procedure that would be undertaken with the help of
which analysis of the data is possible. It is seen that the analysis is the essential part that is
helpful in the determination of the result with the help of which the addressing of the objectives
would be possible. It is seen that there are several processes that are available for use but the
technique that is selected would be on the basis of the topic and the kind of outcome that is
expected out of the paper (Stevenson and Burstall 2016). It is seen that impact of the departure of
the CEOs on the share prices is the main motive of the paper and therefore the share prices of all
the four companies before and after the departure of the CEOs has been collected. This data is
inserted in the E-View software and thereby a comparison is possible that is helpful in creating
an understanding of the fact that the level of impact departure of the CEOs has taken place in the
companies and which of the two industries have been affected more.
3.10 Ethical Consideration
Ethics is something, which maintains the integrity of the research and therefore ethics
need to be mentioned at the end of the methodology in order to ascertain the authenticity of the
research (Rivolta 2018). Ethics need to certify the fact that data which has been used are fair and
true and this ensures that the result that is attained is ideal for future use. In accordance to this
paper, integrity is maintained and therefore bona fide sources have been used and the rules and

35
DEPARTURE OF A CEO
regulations that have been laid down by the international bodies in accordance to this topic has
been maintained. Hence, the authenticity of the result of the paper is guaranteed.

36
DEPARTURE OF A CEO
Chapter 4: Data Analysis and Discussion
4.1 Introduction
This section of the paper is the main section of the paper where the collected is analysed
with the help of the tool that is explained earlier and thereafter the desirable outcome is possible.
It is seen that descriptive and extensive analysis is done so that all the aspects would be
explained and a comprehensive analysis on the topic as well on the selected companies can be
done in order to reach the outcome that can be used for future use. This would even be helpful in
the creation of the idea and the understanding of the impact of the departure of the CEOs in the
four companies that have been selected.
The event of turnover of the CEOs takes place due to various factors and situations. The
turnover is possible due to voluntary exits, dismissal, retirement, health and death and aging. The
performance of the companies change prior and after the departure of the CEO and Cline and
Yore (2016) has stressed on the fact that the companies with performance that is either good or
poor are likely to face departure of the CEOs. It has been discovered that ineffective performance
of the companies is correlated positively with the departure of the CEO. On the other hand, it has
been discovered that additional returns are essentially possible at the disclosure of the change of
the management in the companies that have been performing in a poor manner. The board of
directors looking to dispose of the CEO creates a dilemma that by doing so it might restrict a
probable recovery and waiting too long may make the scenario even worse (Shapiro et al. 2016).
There are evidences that the likelihood of the CEO turnover enhances in a company that is
distressed. It is even seen that the stock market as well as the share prices react with the change
or the departure of the CEOs and this has considerable amount of impact on the brand image and
the extent of external investment. The CEOs are the face of the companies and therefore their

37
DEPARTURE OF A CEO
departure would have an impact on the performance of the companies as well. The same has
been observed for Audi, Volkswagen, Apple and Samsung and this has greatly impacted the
share prices as well. The companies have their competitors in the global market and therefore in
order to maintain their competitive edge the companies need to maintain firm operational
activities and need to ready with the contingency plans in case the departure of the CEOs and
any kind of unprecedented events take place. This is the process with the help of which detailed
analysis on the impact of the departure of the CEO can be understood.
4.2 Data Analysis:
For every research, ‘Data analysis’ is the most crucial task during the whole research
process. The following step of the data analysis is to collect the data. The data source is
secondary in nature. The gathered data must be scientifically and significantly processed or
analysed for research study. Data processing is the editing, coding, merging, cleaning,
classifying and tabulation of the collected data (Norušis 2006). Data analysis is the method that
undertaken the calculation and computation of the certain parameters as well as searching the
pattern of the associations (Shumway 1987). The major concept of the existing data analysis
undertakes the testing of hypothesis and support of statistical tools.
The Changing procedure of CEO in multinational companies like Apple or Samsung,
Volkswagen or AUDI is very common in nature. The influence of Change of CEO in those
organisations sometimes may be worthy and sometimes unfruitful. The researcher is interested in
making a secondary research and survey analysis to validate the truth. The implications of the
researcher have incorporated corporate governance, entrepreneurship and industry performance.
The CEO change could effectively be more sustainable for the future of the company. However,

38
DEPARTURE OF A CEO
sometimes the bad inclusion of new Chief executive officer (CEO) may become the cause of the
downfall of the organisation.
In this research study, the data is collected from selected two reputed mobile
manufacturing companies and two car manufacturing companies. The mobile manufacturing
companies are ‘Apple’ and ‘Samsung’. The car manufacturing companies are ‘Volkswagen’ and
‘AUDI’. The data is segregated in two parts with respect to ‘Change of CEO’ in those
companies. The close prices of the companies are accomplished with respect to tenure of after
and before of the CEO of the company. The cleaned and rectified data is analysed with the help
of ‘EViews’ software. Data analysis techniques are mainly descriptive statistics, independent
sample t-test along with graphical visualisations.
Testing of hypothesis:
The hypothesis is the key element in this research. The major function of the hypothesis
testing is to advice the new principles, observations and rules (William 2000). Hypothesis may
be defined in the way that it is the simple and basic assumption or some proposition that is to be
proved or disproved.
The researchers follow a systematic process for determining whether to reject or accept
the null hypothesis or not. The hypotheses undertake two types of hypothesis that are ‘Null
hypotheses and ‘Alternative hypotheses. The important aspect of hypothesis testing is the level
of significance. Here, the statistical tests are allowed with respect to 5% level of significance.
The hypothesis might not be proved absolutely, however, in general, if it has withstood a critical
testing (Klayman and Ha 1987). The researchers have attempted to validate the assertions by
considering the different parameters of association. These parameters and variables are

39
DEPARTURE OF A CEO
considered and chosen from different domains and stations of reliability with the hypothesis
(Shaffer 1995).
Mainly four hypotheses are taken under consideration that are tested with the help of
‘Independent sample t-tests’ in the followings.
Hypothesis 1:
Null hypothesis (H0): The average close prices of ‘Apple’ after and before of medical leave of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Apple’ after and before medical leave
of CEO are unequal.
Hypothesis 2:
Null hypothesis (H0): The average close prices of ‘Samsung’ after and before of resignation of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Samsung’ after and before recognition
of CEO are unequal.
Hypothesis 3:
Null hypothesis (H0): The average close prices of ‘AUDI’ after and before arrest of CEO are
equal.
Alternative hypothesis (HA): The average close prices of ‘AUDI’ after and before arrest of CEO
are unequal.
Hypothesis 4:

40
DEPARTURE OF A CEO
Null hypothesis (H0): The average close prices of ‘Volkswagen’ after and before removal of
CEO are equal.
Alternative hypothesis (HA): The average close prices of ‘Volkswagen’ after and before removal
of CEO are unequal.
Visualization:
The visualisation is represented with the help of line plot and box plot. The line plot is an
effective way of visualising a trend of the data set. It is a graph that indicates frequency of data
along a ‘Number line’ (Heer, Kong and Agrawala 2009). It is the best concept to use a line plot
in a quick and simple way in organizing data. In this visualisation, data points connected by lines
are greatly versatile supporting non-linear, linear, logarithmic and time-series trend. The box plot
is capable of having five-number summary and represents a summary of large amount of data. A
box-whisker plot includes the median which is the midpoint of the data set. The upper and lower
quartile represents the numbers above and below the highest and lower quarters of the data and
the minimum and maximum data values. Summarising data with the help of box plot utilising
five key ideas is an effective way to deal with large data visually (Kampstra 2008).
Mobile phone:
Apple Inc. is the most eminent mobile manufacturing company. Analysts often ask the
executives to talk about iPhone prices. Samsung is the competitor of Apple Inc. They are also
trying to expand their business worldwide and overtake Apple Inc.
Apple close price comparison after and before CEO change:

41
DEPARTURE OF A CEO
45
46
47
48
49
50
51
52
2 4 6 8 10 12 14 16 18 20 22 24
Apple_Close_price_after
Apple_Close_price_before
45
46
47
48
49
50
51
52
The close price of ‘Apple’ has hiked significantly after the change of CEO (Steve
Jobs).The close prices of the reputed mobile manufacturing organisation have increased
significantly. However, the close price of ‘Apple’ has never been greater than $50 before
changing of CEO. The CEO took his medical leave on 17th January, 2011. However, the close
price of ‘Apple’ is greater than $50 for many occasions. No instances are observed where close
price before CEO change is greater than the close price after CEO change. The mean and median
close prices of ‘Apple’ are greater after leaving of Steve Jobs. . It is even seen that the first
quartile of the close price of ‘Apple’ after CEO change is greater than third quartile of close
price of ‘Apple’ before CEO change. The average close price of ‘Apple’ after CEO change is
between $49 and $50. The average close price of ‘Apple’ before CEO change is between $47
and $48.

42
DEPARTURE OF A CEO
Samsung close price comparison after and before CEO change:
49,000
50,000
51,000
52,000
53,000
54,000
55,000
56,000
57,000
58,000
2 4 6 8 10 12 14 16 18 20 22 24
Samsung_Close_price_after
Samsung_Close_price_before
49,000
50,000
51,000
52,000
53,000
54,000
55,000
56,000
57,000
58,000
The close price of ‘Samsung’ has hiked significantly after the change of CEO (Oh-Hyun
Kwon). The close prices of this eminent mobile manufacturing organisation have increased for
most of the time. However, the close price of ‘Samsung’ has never been greater than 55K Korean
Yen before changing of CEO. The CEO submitted his resignation on 12nd January, 2017.
However, the close price of ‘Samsung’ is greater than 55K Korean Yen for many occasions.
Only few instances are observed where close price before CEO change is greater than the close
price after CEO change. The mean and median close prices of ‘Samsung’ are greater after
leaving of Oh-Hyun Kwon. . It is even seen that the first quartile of the close price of ‘Samsung’
after CEO change is greater than third quartile of close price of ‘Samsung’ before CEO change.
The average close price of ‘Samsung’ before CEO change is between 52K Korean Yen and 53K
Korean Yen. The average close price of ‘Samsung’ after CEO change is between 55K Korean
Yen and 56K Korean Yen.

43
DEPARTURE OF A CEO
Car Company:
Investors and customers focus on most reliable cars. Volkswagen and AUDI both are
reputed company world-wide. These car manufacturing companies are German. However, the
preferability and choice of investors is high enough with the AUDI rather than Volkswagen. The
image of CEO and top officials creates a brand image and brand standing for the car
manufacturing companies. However, predicted reliability and owner satisfaction ratings are also
crucial aspects of these brands.
Volkswagen close price comparison after and before CEO change:
20
24
28
32
36
40
2 4 6 8 10 12 14 16 18 20 22 24
Volkswagen_Close_Price_After
Volkswagen_Close_Price_Before
20
24
28
32
36
40
The close price of ‘Volkswagen’ has decreased significantly after the resignation of CEO
(Martin Winterkorn) due to ‘Emission case’. The close prices of this famous car manufacturing
organisation have decreased for most of the time after resignation. The close price before

44
DEPARTURE OF A CEO
resignation of CEO has been detreated for significant duration. The close price of ‘Volkswagen’
has never been greater than 30euro after changing of CEO. The CEO submitted his resignation
on 23rdSeptember, 2015. However, the close price of ‘Volkswagen’ is greater than 36euro for
many occasions. Only few instances are observed where close price after CEO change is greater
than the close price before CEO change. The mean and median close prices of ‘Volkswagen’
were greater before leaving of Martin Winterkorn. . It is even seen that the first quartile of the
close price of ‘Volkswagen’ before CEO change is greater than third quartile of close price of
‘Volkswagen’ after CEO change. The average close price of ‘Volkswagen’ before CEO change
is between 36euro and 40 euro. The average close price of ‘Volkswagen’ after CEO change is
between 24euro and 28 euro.
AUDI close price comparison after and before CEO change:
720
740
760
780
800
820
840
2 4 6 8 10 12 14 16 18 20 22 24
AUDI_Close_Price_After
AUDI_Close_Price_Before
720
740
760
780
800
820
840

45
DEPARTURE OF A CEO
The close price of ‘AUDI’ has reduced significantly after the CEO (Rupert Stadler) was
arrested. The close prices of this famous car manufacturing organisation have decreased for most
of the time. However, the close price of ‘AUDI’ has never been greater than 820 euro after
changing of CEO. The CEO was removed on 18thJune, 2018. However, the close price of
‘AUDI’ is greater than 800euro for many cases. Only few instances are observed where close
price after removal of CEO is greater than the close price before CEO change. The mean and
median close prices of ‘AUDI’ are higher before removal of Rupert Stadler. It is even seen that
the first quartile of the close price of ‘AUDI’ before CEO change is greater than third quartile of
close price of ‘AUDI’ after CEO change. The average close price of ‘AUDI’ after CEO change
is between 800euro and 820 euro. The average close price of ‘AUDI’ before CEO change is
between 740euro and 760 euro.
Descriptive statistics:
Descriptive statistics are utilised to identify the basic features of the data set in the study.
It provides simple and easy summaries about the measures and sample. Along with graphical
analysis, the descriptive statistics virtually and quantitatively analyses data (Data and Using
Descriptive Statistics Bartz 1988). Descriptive statistics or summary statistics involve the lots of
measures such as- ‘Mean’, ‘Median’, ‘Standard deviation’, ‘Maximum’, ‘Minimum’, ‘Skewness’
and ‘Kurtosis’. Mainly two features that are – ‘Central tendency’ and ‘Dispersion’ of the entire
sample are accomplished with the help of descriptive statistics (Bluman 2009). Descriptive
statistics help to describe, show or help to reach to the conclusions regarding any kind of asserted
assumptions.
Apple mobile company:

46
DEPARTURE OF A CEO
APPLE_CL... APPLE_CL...
Mean 49.252286 47.32014335
Median 49.0921440... 46.7885725
Maximum 51.311428 49.782856
Minimum 46.674286 45.8014300...
Std. Dev. 1.26503356... 1.28515182...
Skewness 0.03327903... 0.62078904...
Kurtosis 2.33045985... 1.94519033...
Jarque-Bera 0.37726165... 2.21178298...
Probability 0.82809215... 0.33091574...
Sum 985.045719... 946.402867
Sum Sq. Dev. 30.4058886... 31.3806888...
Observations 20 20
The average close price of the ‘Apple’ before CEO change is $47.32 and average close
price of this organisation after CEO change is $49.25. The median close price of ‘Apple’ is also
higher after change of CEO ($49.09>$46.79). The maximum close price for two different tenures
is higher for ‘After change’ ($51.31>$49.78). The minimum close price for two different tenures
is higher for ‘Before change’ ($46.67>$45.80). The scatterness in terms of standard deviation is
observed lesser for the ‘After change’ rather than ‘Before change’ (SD: $1.285>$1.265).
Samsung mobile company:
SAMSUNG_... SAMSUNG_...
Mean 55046.96 52077.50
Median 54800.00 52170.00
Maximum 57220.00 54800.00
Minimum 52400.00 49600.00
Std. Dev. 1437.012 1624.362
Skewness -0.098751 0.058907
Kurtosis 1.739775 2.072211
Jarque-Bera 1.559375 0.583114
Probability 0.458549 0.747099
Sum 1266080. 833240.0
Sum Sq. Dev. 45430087 39578300
Observations 23 16

47
DEPARTURE OF A CEO
The average close price of the ‘Samsung’ before CEO resignation is 52077.5 Korean Yen
and average close price of this organisation after CEO change is 55046.96 Korean Yen. The
median close price of ‘Samsung’ is also higher after change of CEO (54800 Korean Yen >52170
Korean Yen). The maximum close price for two different tenures is higher for ‘After change’
(57220 Korean Yen >54800 Korean Yen). The minimum close price for two different tenures is
higher for ‘Before change’ (52400 Korean Yen >49600 Korean Yen). The scatter ness in terms
of standard deviation is observed lesser for the ‘After change’ rather than ‘Before change’(SD:
1624.362 Korean Yen >1437.012 Korean Yen).
Volkswagen Car Company:
VOLKSWAG... VOLKSWAG...
Mean 26.47130 35.96913
Median 26.98000 37.24000
Maximum 30.47000 38.52000
Minimum 23.07000 25.44000
Std. Dev. 2.135216 3.498045
Skewness -0.159264 -2.151860
Kurtosis 2.004824 6.295207
Jarque-Bera 1.046342 28.15621
Probability 0.592638 0.000001
Sum 608.8400 827.2900
Sum Sq. Dev. 100.3013 269.1990
Observations 23 23
The average close price of the ‘Volkswagen’ before CEO resignation is 26.47euro and
average close price of this organisation after CEO change is 35.97 euro. The median close price
of ‘Volkswagen’ was also higher before change of CEO (38.52 euro>26.98 euro). The maximum
close price for two different tenures is lower for ‘After change’ (38.52 euro>30.47 euro). The
minimum close price for two different tenures is higher for ‘Before change’ (25.44
euro>23.07euro). The scatterness in terms of standard deviation is observed higher for the
‘Before change’ rather than ‘After change’ (SD: 3.498 euro>2.135 euro).

48
DEPARTURE OF A CEO
AUDI Car Company:
AUDI_CLO... AUDI_CLO...
Mean 755.529411... 817
Median 747 818
Maximum 806 830
Minimum 726 791
Std. Dev. 23.1627870... 10.1587400...
Skewness 0.80690628... -0.9667525...
Kurtosis 2.40074013... 3.43132267...
Jarque-Bera 2.09914822... 3.43392075...
Probability 0.35008681... 0.17961126...
Sum 12844 17157
Sum Sq. Dev. 8584.23529... 2064
Observations 17 21
The average close price of the ‘AUDI’ before CEO removal is 755.53 euro and average
close price of this organisation after CEO change is 817 euro. The median close price of ‘AUDI’
was also higher before change of CEO (818 euro>747 euro). The maximum close price for two
different tenures is lower for ‘After change’ (830 euro>806 euro). The minimum close price for
two different tenures is higher for ‘Before change’ (791 euro>726 euro). The scatter ness in
terms of standard deviation is observed lesser for the ‘Before change’ rather than ‘After change’
(SD: 23.163 euro>10.159 euro).
Independent sample t-test:
Independent sample t-test compares the averages of two independent groups for
determining whether there exists any statistical evidence that the related population averages are
significantly different or not. One of the best parametric test is ‘Independent sample t-test’. It is
the testing procedure where the variables in the analysis are split into dependent and independent
variables (Heeren and D'Agostino 1987). This hypothesis testing assumes that a difference in the
average score of dependent variable is found because of the impact of the independent factors.

49
DEPARTURE OF A CEO
Apple:
Test for Equality of Means of APPLE_CLOSE_PRICE
Categorized by values of CEO_CHANGE
Date: 07/27/18 Time: 13:13
Sample (adjusted): 8/01/2016 8/01/2059
Included observations: 44 after adjustments
Method df Value Probability
t-test 42 5.538274 0.0000
Satterthwaite-Welch t-test* 41.46773 5.576277 0.0000
Anova F-test (1, 42) 30.67248 0.0000
Welch F-test* (1, 41.4677) 31.09487 0.0000
*Test allows for unequal cell variances
Analysis of Variance
Source of Variation df Sum of Sq. Mean Sq.
Between 1 55.05967 55.05967
Within 42 75.39351 1.795084
Total 43 130.4532 3.033795
Category Statistics
Std. Err.
CEO_CHA... Count Mean Std. Dev. of Mean
After 24 49.56673 1.383330 0.282371
Before 20 47.32014 1.285152 0.287369
All 44 48.54555 1.741779 0.262583
The calculated t-statistic retrieved from independent sample t-test is 5.538274 (df = 42).
The p-value of the t-statistic = 0.0. The calculated p-value is less than less than 0.05 (level of
significance). Therefore, it could be interpreted with 95% probability that the null hypothesis
could be rejected. Hence, it could be inferred that the average close price before and after the
medical leave of CEO are unequal to each other.
The ANOVA F-test (p-value = 0.0) refers the difference of significant variability of close
prices before and after medical leave of CEO in ‘Apple’.

50
DEPARTURE OF A CEO
Samsung:
Test for Equality of Means of SAMSUNG_CLOSE_PRICE
Categorized by values of CEO_CHANGE
Date: 07/27/18 Time: 13:35
Sample (adjusted): 6/01/2017 6/01/2055
Included observations: 39 after adjustments
Method df Value Probability
t-test 37 6.017811 0.0000
Satterthwaite-Welch t-test* 29.76400 5.883950 0.0000
Anova F-test (1, 37) 36.21405 0.0000
Welch F-test* (1, 29.764) 34.62087 0.0000
*Test allows for unequal cell variances
Analysis of Variance
Source of Variation df Sum of Sq. Mean Sq.
Between 1 83202649 83202649
Within 37 85008387 2297524.
Total 38 1.68E+08 4426606.
Category Statistics
Std. Err.
CEO_CHA... Count Mean Std. Dev. of Mean
After 23 55046.96 1437.012 299.6377
Before 16 52077.50 1624.362 406.0906
All 39 53828.72 2103.950 336.9017
The calculated t-statistic retrieved from independent sample t-test is 6.017811 (df = 37).
The p-value of the t-statistic = 0.0. The calculated p-value is less than less than 0.05 (level of
significance). Therefore, it could be interpreted with 95% probability that the null hypothesis
could be rejected. Hence, it could be inferred that the average close price before and after the
resignation of CEO are unequal to each other.
The ANOVA F-test (p-value = 0.0) refers the difference of significant variability of close
prices before and after resignation of CEO in ‘Samsung’.

51
DEPARTURE OF A CEO
AUDI:
Test for Equality of Means of AUDI_CLOSE_PRICE
Categorized by values of CEO_CHANGE
Date: 07/27/18 Time: 13:32
Sample (adjusted): 6/01/2017 6/01/2054
Included observations: 38 after adjustments
Method df Value Probability
t-test 36 -10.95525 0.0000
Satterthwaite-Welch t-test* 20.96415 -10.17831 0.0000
Anova F-test (1, 36) 120.0174 0.0000
Welch F-test* (1, 20.9641) 103.5981 0.0000
*Test allows for unequal cell variances
Analysis of Variance
Source of Variation df Sum of Sq. Mean Sq.
Between 1 35499.26 35499.26
Within 36 10648.24 295.7843
Total 37 46147.50 1247.230
Category Statistics
Std. Err.
CEO_CHA... Count Mean Std. Dev. of Mean
After 17 755.5294 23.16279 5.617801
Before 21 817.0000 10.15874 2.216819
All 38 789.5000 35.31614 5.729034
The calculated t-statistic retrieved from independent sample t-test is (-10.95525) (df =
36). The p-value of the t-statistic = 0.0. The calculated p-value is less than less than 0.05 (level of
significance). Therefore, it could be interpreted with 95% probability that the null hypothesis
could be rejected. Hence, it could be inferred that the average close price before and after arrest
of CEO are unequal to each other.
The ANOVA F-test (p-value = 0.0) refers the difference of significant variability of close
prices before and after arrest of CEO in ‘AUDI’.

52
DEPARTURE OF A CEO
Volkswagen:
Test for Equality of Means of SAMSUNG_CLOSE_PRICE
Categorized by values of CEO_CHANGE
Date: 07/27/18 Time: 13:35
Sample (adjusted): 6/01/2017 6/01/2055
Included observations: 39 after adjustments
Method df Value Probability
t-test 37 6.017811 0.0000
Satterthwaite-Welch t-test* 29.76400 5.883950 0.0000
Anova F-test (1, 37) 36.21405 0.0000
Welch F-test* (1, 29.764) 34.62087 0.0000
*Test allows for unequal cell variances
Analysis of Variance
Source of Variation df Sum of Sq. Mean Sq.
Between 1 83202649 83202649
Within 37 85008387 2297524.
Total 38 1.68E+08 4426606.
Category Statistics
Std. Err.
CEO_CHA... Count Mean Std. Dev. of Mean
After 23 55046.96 1437.012 299.6377
Before 16 52077.50 1624.362 406.0906
All 39 53828.72 2103.950 336.9017
The calculated t-statistic retrieved from independent sample t-test is (6.017811) (df = 37).
The p-value of the t-statistic = 0.0. The calculated p-value is less than less than 0.05 (level of
significance). Therefore, it could be interpreted with 95% probability that the null hypothesis
could be rejected. Hence, it could be inferred that the average close price before and after
removal of CEO are unequal to each other.
The ANOVA F-test (p-value = 0.0) refers the difference of significant variability of close
prices before and after removal of CEO in ‘Volkswagen’.

53
DEPARTURE OF A CEO
4.3 Findings:
A transformation in stock price can change depending on a number of factors when a new
CEO takes over a company. Most of the factors are based on the ‘Market perception’ about the
agility and ability of new CEO at the time of upbringing the company. Irrespective of whether
the transformation is arranged or the outcome is achieved with respect to unexpected
circumstances, the way the close prices perform partly reflect the processes of transition
management of the company. Investors tend to be more contented with new CEOs who are
known to the dynamics of the industry in which the companies operate corporate strategy.
Furthermore, the transition is assumed to be unplanned. It causes due to chances that the new
CEO might shift corporate strategy for the critical situation. The management of the transition
period and the proper planning set by the new CEO are crucial factors for investors to consider.
The reputation is also a key factor of the eminent luxury companies. The investors and
consumers assess the track record of Chief executive officer (CEO) to create the shareholder
value. Such kind of pedigree can be reflected in a number of segments involving a capability to
grow market share, decrement in costs and expansion into new growth markets. Generally, no
significant relationship could be found how the stock performs after change of CEO in spite of
concerns of initial investors. A transformation in CEO carries more downside risk rather than
unplanned transition. All organisations are different in many ways and belong to various stages
within the markets and development in many ways. It is the reason that all the CEOs have to
focus more on the opportunities available in the market so that they can make their strategic
decisions. The initiatives regarding ensuring profitability are generally regulated from the end of
CEO.
Comparison of ‘Apple’ and ‘Samsung’ with respect to the Change of CEO:

54
DEPARTURE OF A CEO
The close prices of ‘Apple’ are overall more or less similar to ‘Samsung’. In both cases,
the close prices have increased after the changing of CEO. The change has become blissful to
both the mobile manufacturing company. The close price has overall increased for ‘Samsung’
significantly rather than ‘Apple’ (Browning, Russolillo and Vascellaro 2012).
Comparison of ‘AUDI’ and ‘Volkswagen’ with respect to the Change of CEO:
The close prices of ‘AUDI’ are overall greater than ‘Volkswagen’. In both cases, the
close prices have decreased after the changing of CEO. The change of CEO hampered the car
manufacturing company. The close price has overall increased for ‘Volkswagen’ significantly
rather than ‘AUDI’ (Mansouri 2016).
It is often observed that the schedule of CEO of any reputed company is significantly
crucial for the financial success of a firm. It raises better inside of an organisation surprisingly.
Finally, the performance measure of CEO exposed varieties of factors like ownership or
governance. There are some industries where a CEO really requires to be outside rather than
being proscriptive. The direct and ground role of the CEOs are very much crucial in those cases.
Car companies are one of them. The resignation of Martin Winterkorn of ‘Volkswagen group’
and the occurrence of arrest of Rupert Stadler of ‘AUDI group’ from the post of CEO put an
effect on the close prices of the car companies. On the other hand, there are some industries
where a CEO do not need to come out outside administration. Mobile manufacturing company
are one of them. Therefore, the medical leave of Steve Jobs of ‘Apple Inc’ and resignation of
Oh-Hyun Kwon of ‘Samsung’ did not put a significant bad effect on the close prices of the
mobile manufacturing companies. The monitoring of efforts of CEO spends beneficiary spending
on the outside. The CEO of more or less every type of company focuses on the productivity with
respect to financial fuel (Huang, Cheng and Chou 2005). An effective CEO must understand the

55
DEPARTURE OF A CEO
valuation of the organisation and its market place. The new CEO would be successful while the
organisation would go with the stakeholders and involve the growth of organisation. The new
CEO must be mindful about the face of organisation. Businesses are built not only by discussion
on table but also by creating a network of relationships in which the organisation operates (Buyl
et al. 2011). The quality and information of the CEO would shape the process of gathering
information. The new CEOs of Volkswagen and AUDI must undertake ‘Networking’ and ‘Fund
raising’ for the stage of growth and the state of internal organisation of the businesses
(Zuckerman 1999).
It is known to all that the CEO of any reputed international brand has overall
responsibility to plan, create, implement and integrate the strategic direction of an organization
(Dalton and Kesner 1987). The role of CEO begins with the fundamental job responsibilities and
duties of a managing authority. CEO takes vital decision and make top-level managerial
decisions. The role of CEO is found crucial for car manufacturing companies but not mobile
manufacturing companies. It clearly indicates that paragon CEOs of Volkswagen or AUDI
stirred the commercial business in critical situations to make sure that the entity remains on the
trajectory of growth. However, the CEOs are not so much found important for the eminent
companies like Apple or Samsung. The visionary, decision-maker, manager and board developer
are simultaneously observed by CEOs of mobile manufacturing companies. It seems that the
change of CEOs did not put a vital effect on the mind set of investors. Although the CEO
manages directly ‘Employees’, ‘Customers’, ‘Investors’ and ‘Communities’ of the mobile
manufacturing industries, the change or removal of CEOs did not directly hamper the brand
value of the company. The close price therefore did not downfall after the change of CEOs in the
respective companies. The CEO of any organisation can take actual decisions devising proper

56
DEPARTURE OF A CEO
financial measures. The new CEOs are may not be enough capable of handling huge organisation
alike previous CEOs. CEO might have struggled to invent the values regarding ‘State-of-the-art’
training for the employees (Chen and Ann 2016). Careful attention to the designing and tracking
of financial measures could help the new CEOs of the car manufacturing companies for
preparing the transition to an ‘Earning-driven’ car manufacturing brands (Zhang and Wiersema
2009). It is appropriate for a CEO to manage operations in required situations. They must
quickly recruit good operational managers and back to lead the entire business.
The CEO has an adequate job to establish the lost reputation in the market again, bring
back the investors again and draw the customers again in a worthy manner. The CEO may
restrict himself or herself by profit optimisation. It is found that social psychology is far more
effective than the behaviour of spot measure. Ultimately, the CEOs must create investment in the
company. The share price is more about vision and salesmanship than the earnings. The market
condition has changed and it is a nice excuse for the newly joined CEOs. However, these excuses
would not last a long to anticipate market and position of the company for the success under a
bunch of scenarios. Keeping himself or herself honest, the CEO could gradually dissolve all the
responsibilities herself (Ireland and Hitt 1999). The high-quality feedback of jobs of CEOs is
mistakenly lead to success. The acknowledgement of all types of responsibility would be
accountable for honest behaviour. The failing CEOs should hold themselves to higher standards
next year than the current scenario.
Automobile and transportation industry – both are the emerging industries. Investors are
investing their preferable brands as per demand in market. They also have a long-lasting aim and
objective for future days. Global manufacturers are looking for alternative market and Asian
countries could be the best option for them. More expansion of business would lead to more

57
DEPARTURE OF A CEO
profitability. The profitability and popularity would lead to higher close prices of the brand
(Jackofsky, Slocum Jr and McQuaid 1988). As the technologies and engineering are growing day
by day, the market is getting more competitive. To sustain their respective places and move
forward, the automobile and transportation companies are regarding their manufacturing
strategies. The in-depth understanding and experience of the CEOs have capability to edge over
‘Global brands’ that require understanding the requirements and aspirants of consumers
(Teigeler 2014). While the competitions get hit, handset and tablet manufacturers are struggling
for maintaining margins. A significant number of mobile phone manufacturing brands are from
developed countries. The new CEOs are launching brand-new mobiles and cars to become
requirements and aspirations of Indian customers.
Almost every mobile and automobile organisation is competing for a share of the market.
The responsibilities and duties are the most crucial parts of decision making of CEOs. The
leadership skill of CEO should have significant ability for managing time effectively and
corporate both internal and external conflicts (Yunlu and Murphy 2012). Sometimes, the
durability and reliability of mobiles uphold the reputation; it helps to keep the close price
stationary.
4.4 Summary of the result
The outcome of the paper is a successful one as it is seen that the degree of impact that
has taken place with the departure of the CEOs of the companies have been understood. The
hypothesis of the paper has been addressed and accordingly E-Views have been helpful in the
creation of the understanding that would be useful in the determination of the result for the four
companies. Each of the four companies have been evaluated individually and thereafter
comparison among the industries have been done so that overall evaluation of the data and the

58
DEPARTURE OF A CEO
impact of the departure of the CEOs for the companies as well for the two industries can be
understood in the most effective way.

59
DEPARTURE OF A CEO
Chapter 5: Conclusion, Recommendation and Future Work
5.1 Conclusion
The paper has that has been constructed has been on the basis of creating an
understanding of the impact that is taking place after the departure of the CEOs on the share
prices. It is seen that there exists a significant amount of relationship among the work and the
performance of the CEOs and the development of the companies as well as the share prices of
the companies. The companies that have been taken into consideration are Audi, Volkswagen,
Apple and Samsung. It is seen that two companies have been selected from the automobile
industry and two from the technological industry. All the companies that have been taken into
consideration are multinational companies and have their own share in the market. The
introduction of the paper has provided an idea about the development of the companies that take
place with the performance of the CEOs. The CEOs have a key role to play as it is seen that they
are the ones who construct plans and policies for the business and even undertakes the process of
decision making. The duty of the CEOs have been addressed in an effective manner and in the
same way the need for external capital in an organization has been highlighted. The background
of the study has explained that share prices are dependent on the performance of the companies
and inn the same way the stakeholders invest in an organization by looking at the performance.
The CEOs look into the operational activities and it is their decision that is prevalent all over the
companies.
The background has even provided extensive idea about the companies that have been
taken into consideration. The operational activities of the companies are different and therefore
each one of them have their own style of obtaining profit. Each of the CEOs have their own
perception and style and therefore their degree of taking risks and making decisions are different.

60
DEPARTURE OF A CEO
These traits have been the key factors that motivates the employees and accordingly has an
impact on the performance of the companies. It is even seen that there are several factors that
leads to the departure of the CEOs. Each of the factors have their own result and therefore the
companies are looking to construct plans and policies with the help of which their performance
can be enhanced and all these aspects can be mitigated. The problem statement of the paper has
highlighted the issues that are existent within a company and the factors that needs to be taken
into consideration with the help of which these issues can be mitigated. These factors lead to the
departure of the CEOs and thereby has an impact on the price of the shares. Hence, the problems
that have been identified has been taken into consideration and accordingly analysis can be done
in order to have an understanding of the overall impact. The research aims and objectives are
constructed on the basis of which the research has moved forward and therefore analysis on these
aspects would be taken into consideration with the help of which effective outcome can be
ascertained.
The literature review of the paper has concentrated on the topic and has looked to explain
the variables that are related to the topic. It is seen that previous authors who have published
articles and journals have been assessed and thereby their outcomes and suggestions have been
taken into consideration with the help of which proper actions and measures can be taken. The
literature has even explained the performance and the operational activities of the four
companies that have been selected and thereby their effectiveness and issues can be highlighted.
This has been a key indicator with the help of which better performance and understanding of the
performance of the companies as well as the impact of the departure of the CEOs on the share
prices would be understood in an effective manner. The literature review has been helpful in the

61
DEPARTURE OF A CEO
development of the methodology with the help of which the kind of data with the help of which
analysis process can be understood.
The methodology of the paper has addressed that secondary data would be taken into
consideration. In order to proceed with the analysis, share prices of the four companies have
been selected and accordingly the share prices before and after the departure of the CEOs has
been analysed in order to have an understanding of whether the departure of the CEOs have been
beneficial or a loss for the companies. Deductive approach has been selected and therefore
models and frameworks that have been used earlier has been considered. Explanatory design has
been selected with the help of which the cause and effect relationship among share price and the
departure of the CEO would be understood in an effective manner. The analysis that has been
done is helpful in the determination of the result and the effectiveness of the result is understood
once the results have been able to address the objectives of the paper.
5.2 Addressing the objectives
The first objective of the paper has tried to understand the reaction of the market in
accordance to the departure of the CEO of the companies. It is seen that the market reveals
significant amount of impact with the departure of the CEOs and this is understood with the fact
that share prices of the automobile industry has deteriorated after the departure of the CEO and
on the other hand the share prices of the mobile industry has developed with the departure of the
CEOs. It can be sensed that departure of the CEOs had a positive impact on the mobile industry
and a negative impact on the automobile industry. In this manner, the reaction of the market has
been observed as well and therefore sales has changed has well. Hence, the first objective has
been met

62
DEPARTURE OF A CEO
The next objective is ascertaining the level of change in the stock prices with the
departure of the CEOs and the results indicate that share prices change by a significant margin
after the departure of the CEOs. The change has been found to be positive for the mobile
companies namely Apple and Samsung and the change has been negative for Audi and
Volkswagen. This indicates that the CEOs of Audi and Volkswagen had better influence on the
performance of the companies than Apple and Samsung and it is due to this fact that the share
prices of the automobile companies has fallen with respect to the share prices of mobile
companies. Hence, it can be ascertained that both the objectives have been attained and the result
that has been discovered is true and future use of the result can be done.
5.3 Recommendation
The outcome that has been developed is helpful in the creation of recommendation with
the help of which better performance of the companies can be ascertained. It is therefore
recommended that the new CEOs need to primarily understand the operational activities and the
plans and policies of the companies so that they can take actions in a better manner.
It is even recommended that the companies should maintain policies and plans that would
motivate the CEOs and would influence them to stay in the company and thereby give out their
best effort for the development of the companies. It is even seen that the companies need to take
care of the best interests of the companies and therefore plans and policies would be constructed
with the help of which development of the companies would be attained.
5.4 Future Work
Future work on this topic is possible due to the fact that the companies will be operating
in the future as well and the share prices of the companies would change as well. It is even seen
that departure of the CEO would take place with the advent of time and therefore future analysis

63
DEPARTURE OF A CEO
on the same topic can be done with the help of which the a comparison should be done with the
help of which better understanding of topic can be done.

64
DEPARTURE OF A CEO
Reference List
Aguinis, H., Gomez-Mejia, L.R., Martin, G.P. and Joo, H., 2018. CEO pay is indeed decoupled
from CEO performance: charting a path for the future. Management Research: Journal of the
Iberoamerican Academy of Management, 16(1), pp.117-136.
Andreou, P.C., Louca, C. and Petrou, A.P., 2017. CEO age and stock price crash risk. Review of
Finance, 21(3), pp.1287-1325.
Apple (United Kingdom)., 2018. [online] Available at: https://www.apple.com/uk/ [Accessed 28
Jul. 2018].
Audi.com., 2018. The World of Audi. [online] Available at: https://www.audi.com/en.html
[Accessed 28 Jul. 2018].
Back, Y. and Kim, E., 2015. When Star CEO Departs. 경경경경경, 44(3), pp.837-874.
Baker, M. and Xuan, Y., 2016. Under new management: Equity issues and the attribution of past
returns. Journal of Financial Economics, 121(1), pp.66-78.
Bargeron, L.L., Schlingemann, F.P., Stulz, R.M. and Zutter, C.J., 2017. What is the shareholder
wealth impact of target CEO retention in private equity deals?. Journal of Corporate
Finance, 46, pp.186-206.
Bennett, B. and Wang, Z., 2018. Do Short Sellers Cause CEOs to Be Fired? Evidence from a
Randomized Experiment.
Bermiss, Y.S. and Murmann, J.P., 2015. Who matters more? The impact of functional
background and top executive mobility on firm survival. Strategic Management Journal, 36(11),
pp.1697-1716.

65
DEPARTURE OF A CEO
Bluman, A.G., 2009. Elementary statistics: A step by step approach. New York: McGraw-Hill
Higher Education.
Boivie, S., Graffin, S.D. and Gentry, R.J., 2016. Understanding the direction, magnitude, and
joint effects of reputation when multiple actors’ reputations collide. Academy of Management
Journal, 59(1), pp.188-206.
Bouaine, W., Charfeddine, L., Arouri, M. and Teulon, F., 2015. The Influence Of CEO
Departure And Board Characteristics On Firm Performance. Journal of Applied Business
Research, 31(2), p.345.
Brown, J.A., Anderson, A., Salas, J.M. and Ward, A.J., 2017. Do investors care about director
tenure? Insights from executive cognition and social capital theories. Organization
Science, 28(3), pp.471-494.
Browning, E.S., Russolillo, S. and Vascellaro, J., 2012. Apple Now Biggest-Ever US
Company. Wall Street Journal, 21.
Buyl, T., Boone, C., Hendriks, W. and Matthyssens, P., 2011. Top management team functional
diversity and firm performance: The moderating role of CEO characteristics. Journal of
management studies, 48(1), pp.151-177.
Byrnes, R.T. and Taylor, S.N., 2015. Voluntary transition of the CEO: owner CEOs' sense of self
before, during and after transition. Frontiers in psychology, 6, p.1633.
Chen, C.M. and Ann, B.Y., 2016. Efficiencies vs. importance-performance analysis for the
leading smartphone brands of Apple, Samsung and HTC. Total Quality Management & Business
Excellence, 27(3-4), pp.227-249.

66
DEPARTURE OF A CEO
Chyz, J.A. and Gaertner, F.B., 2017. Can Paying “Too Much” or “Too Little” Tax Contribute to
Forced CEO Turnover?. The Accounting Review, 93(1), pp.103-130.
Cline, B.N. and Yore, A.S., 2016. Silverback CEOs: Age, experience, and firm value. Journal of
Empirical Finance, 35, pp.169-188.
Conyon, M.J., He, L. and Zhou, X., 2015. Star CEOs or political connections? Evidence from
China's publicly traded firms. Journal of Business Finance & Accounting, 42(3-4), pp.412-443.
Crossland, C., Zyung, J., Hiller, N.J. and Hambrick, D.C., 2014. CEO career variety: Effects on
firm-level strategic and social novelty. Academy of Management Journal, 57(3), pp.652-674.
Cummings, T. and Knott, A.M., 2017. Outside CEOs and innovation. Strategic Management
Journal.
Dalton, D.R. and Kesner, I.F., 1987. Composition and CEO duality in boards of directors: An
international perspective. Journal of International Business Studies, 18(3), pp.33-42.
Data, S. and Using Descriptive Statistics Bartz, A.E., 1988. Basic statistical concepts. New
York: Macmillan. Devore, J., and Peck.
Deb, P. and Wiklund, J., 2017. The effects of CEO founder status and stock ownership on
entrepreneurial orientation in small firms. Journal of Small Business Management, 55(1), pp.32-
55.
Demirtas, G. and Simsir, S.A., 2016. The effect of CEO departure on target firms’ post-takeover
performance: Evidence from not-delisting target firms. Finance Research Letters, 16, pp.55-65.
Driver, C. and Guedes, M.J.C., 2017. R&D and CEO departure date: do financial incentives
make CEOs more opportunistic?. Industrial and Corporate Change, 26(5), pp.801-820.

67
DEPARTURE OF A CEO
Driver, C. and Guedes, M.J.C., 2017. R&D and CEO departure date: do financial incentives
make CEOs more opportunistic?. Industrial and Corporate Change, 26(5), pp.801-820.
Eckbo, B.E., Thorburn, K.S. and Wang, W., 2016. How costly is corporate bankruptcy for the
CEO?. Journal of Financial Economics, 121(1), pp.210-229.
Faccio, M., Marchica, M.T. and Mura, R., 2016. CEO gender, corporate risk-taking, and the
efficiency of capital allocation. Journal of Corporate Finance, 39, pp.193-209.
Gao, H., Harford, J. and Li, K., 2017. CEO turnover–performance sensitivity in private
firms. Journal of Financial and Quantitative Analysis, 52(2), pp.583-611.
Garg, S., Li, Q. and Shaw, J.D., 2018. Undervaluation of directors in the board hierarchy: Impact
on turnover of directors (and CEOs) in newly public firms. Strategic Management
Journal, 39(2), pp.429-457.
Geertsema, P.G., Lont, D.H. and Lu, H., 2016. Stock price response to new‐CEO earnings
news. Accounting & Finance.
Hanssens, J., Deloof, M. and Vanacker, T., 2016. The evolution of debt policies: New evidence
from business startups. Journal of Banking & Finance, 65, pp.120-133.
Harjoto, M.A., Laksmana, I. and Lee, R., 2015. The impact of demographic characteristics of
CEOs and directors on audit fees and audit delay. Managerial Auditing Journal, 30(8/9), pp.963-
997.
Heer, J., Kong, N. and Agrawala, M., 2009, April. Sizing the horizon: the effects of chart size
and layering on the graphical perception of time series visualizations. In Proceedings of the
SIGCHI conference on human factors in computing systems(pp. 1303-1312). ACM.

68
DEPARTURE OF A CEO
Heeren, T. and D'Agostino, R., 1987. Robustness of the two independent samples t‐test when
applied to ordinal scaled data. Statistics in medicine, 6(1), pp.79-90.
Hou, W., Priem, R.L. and Goranova, M., 2017. Does one size fit all? Investigating pay–future
performance relationships over the “seasons” of CEO tenure. Journal of management, 43(3),
pp.864-891.
Huang, M.P., Cheng, B.S. and Chou, L.F., 2005. Fitting in organizational values: The mediating
role of person-organization fit between CEO charismatic leadership and employee
outcomes. International Journal of Manpower, 26(1), pp.35-49.
Intintoli, V.J., Serfling, M. and Shaikh, S., 2017. CEO Turnovers and Disruptions in Customer–
Supplier Relationships. Journal of Financial and Quantitative Analysis, 52(6), pp.2565-2610.
Ireland, R.D. and Hitt, M.A., 1999. Achieving and maintaining strategic competitiveness in the
21st century: The role of strategic leadership. Academy of Management Perspectives, 13(1),
pp.43-57.
Jackofsky, E.F., Slocum Jr, J.W. and McQuaid, S.J., 1988. Cultural values and the CEO:
Alluring companions?. Academy of Management Perspectives, 2(1), pp.39-49.
Jenter, D. and Kanaan, F., 2015. CEO turnover and relative performance evaluation. The Journal
of Finance, 70(5), pp.2155-2184.
Jenter, D. and Lewellen, K., 2015. CEO preferences and acquisitions. The Journal of
Finance, 70(6), pp.2813-2852.
Jenter, D. and Lewellen, K.A., 2017. Performance-induced CEO turnover.

69
DEPARTURE OF A CEO
Jochem, T., Ladika, T. and Sautner, Z., 2016. The retention effects of unvested equity: Evidence
from accelerated option vesting. The Review of Financial Studies.
John Harry III, E., Gao, Z., Hwang, Y. and Wu, W.T., 2017. Performance periods in CEO
performance-based equity awards: theory and evidence. The Accounting Review, 93(2), pp.161-
190.
Jönsson, C.A. and Tarukoski, E., 2017. How does an appointed ceo influence the stock price?: A
Multiple Regression Approach.
Kampstra, P., 2008. Beanplot: A boxplot alternative for visual comparison of distributions.
Khanna, V., Kim, E.H. and Lu, Y., 2015. CEO connectedness and corporate fraud. The Journal
of Finance, 70(3), pp.1203-1252.
Kim, J.B., Wang, Z. and Zhang, L., 2016. CEO overconfidence and stock price crash
risk. Contemporary Accounting Research, 33(4), pp.1720-1749.
Klayman, J. and Ha, Y.W., 1987. Confirmation, disconfirmation, and information in hypothesis
testing. Psychological review, 94(2), p.211.
Krause, R., Priem, R. and Love, L., 2015. Who's in charge here? Co‐CEOs, power gaps, and firm
performance. Strategic Management Journal, 36(13), pp.2099-2110.
Krause, R., Semadeni, M. and Cannella Jr, A.A., 2014. CEO duality: A review and research
agenda. Journal of Management, 40(1), pp.256-286.
Krenn, P., 2017. The impact of taxes on competition for CEOs. European Accounting
Review, 26(3), pp.503-530.

70
DEPARTURE OF A CEO
Li, W., Lu, Y., Makino, S. and Lau, C.M., 2017. National power distance, status incongruence,
and CEO dismissal. Journal of World Business, 52(6), pp.809-818.
Lim, E.N., 2015. The role of reference point in CEO restricted stock and its impact on R&D
intensity in high‐technology firms. Strategic Management Journal, 36(6), pp.872-889.
Lim, J. and Love, E.G., 2017. Changing of the Guards: The Impact of CEO Succession on
Corporate Reputation. In Academy of Management Proceedings (Vol. 2017, No. 1, p. 14866).
Briarcliff Manor, NY 10510: Academy of Management.
Liu, A.X., Liu, Y. and Luo, T., 2016. What drives a Firm’s choice of product recall remedy? The
impact of remedy cost, product hazard, and the CEO. Journal of Marketing, 80(3), pp.79-95.
Mansouri, N., 2016. A case study of Volkswagen unethical practice in diesel emission
test. International Journal of Science and Engineering Applications, 5(4), pp.211-216.
Mukherjee, T. and Nguyen, H., 2018. CEO ability and firm performance: Stock market and job
market reactions. Journal of Economics and Finance, 42(1), pp.138-154.
Norušis, M.J., 2006. SPSS 14.0 guide to data analysis. Upper Saddle River, NJ: Prentice Hall.
Pan, Y., Wang, T.Y. and Weisbach, M.S., 2015. Learning about CEO ability and stock return
volatility. The Review of Financial Studies, 28(6), pp.1623-1666.
Pan, Y., Wang, T.Y. and Weisbach, M.S., 2016. CEO investment cycles. The Review of
Financial Studies, 29(11), pp.2955-2999.
Quigley, T.J., Crossland, C. and Campbell, R.J., 2017. Shareholder perceptions of the changing
impact of CEOs: Market reactions to unexpected CEO deaths, 1950–2009. Strategic
Management Journal, 38(4), pp.939-949.

71
DEPARTURE OF A CEO
Quigley, T.J., Crossland, C. and Campbell, R.J., 2017. Shareholder perceptions of the changing
impact of CEOs: Market reactions to unexpected CEO deaths, 1950–2009. Strategic
Management Journal, 38(4), pp.939-949.
Randøy, T., Strøm, R.Ø. and Mersland, R., 2015. The impact of entrepreneur–CEOs in
microfinance institutions: A global survey. Entrepreneurship Theory and Practice, 39(4),
pp.927-953.
Rivolta, M.L., 2018. Does Lead Time in CEO Succession Matter? Evidence From Planned
Versus Unexpected CEO Departures. International Journal of Financial Research, 9(3), p.1.
Rivolta, M.L., 2018. Worth the wait? Delay in CEO succession after unplanned CEO
departures. Journal of Corporate Finance, 49, pp.225-251.
Samsung uk., 2018. [online] Available at: https://www.samsung.com/uk/ [Accessed 28 Jul.
2018].
Schoar, A. and Zuo, L., 2016. Does the market value CEO styles?. American Economic
Review, 106(5), pp.262-66.
Shaffer, J.P., 1995. Multiple hypothesis testing. Annual review of psychology, 46(1), pp.561-584.
Shapiro, D.L., Hom, P., Shen, W. and Agarwal, R., 2016. How do leader departures affect
subordinates’ organizational attachment? A 360-degree relational perspective. Academy of
Management Review, 41(3), pp.479-502.
Shumway, R.H., 1987. Statistics and data analysis in geology.

72
DEPARTURE OF A CEO
Stevenson, C. and Burstall, D., 2016, March. The role of change management in the District
Health Authority Consolidation (Transition and Design) project in Nova Scotia. In Healthcare
management forum (Vol. 29, No. 2, pp. 74-77). Sage CA: Los Angeles, CA: SAGE Publications.
Teigeler, J., 2014. Corporate Evaluation of the Audi AG. GRIN Verlag.
Tupper, C.H., 2016. Crisis Conditions and Performance of IPO Firms: Impact of Founder-CEOs
and Foreign Listings. Journal of Applied Management and Entrepreneurship, 21(1), p.32.
Volkswagen.com., 2018. volkswagen.com. [online] Available at: https://www.volkswagen.com/
[Accessed 28 Jul. 2018].
Wang, H., Zhao, S. and Chen, G., 2017. Firm‐specific knowledge assets and employment
arrangements: Evidence from CEO compensation design and CEO dismissal. Strategic
Management Journal, 38(9), pp.1875-1894.
Wang, Y.K.M. and Yang, K.M., 2015. The impact of executive job demands on dismissals of
newly appointed CEOs. Journal of Management & Organization, 21(6), pp.705-724.
William, L.T., 2000. Null hypothesis testing: problems, prevalence, and an alternative. J. Wildl.
Manage, 64(4), pp.912-923.
Yunlu, D.G. and Murphy, D.D., 2012. R&D intensity and economic recession: Investigating the
moderating role of CEO characteristics. Journal of Leadership & Organizational Studies, 19(3),
pp.284-293.
Zhang, Y. and Qu, H., 2016. The impact of CEO succession with gender change on firm
performance and successor early departure: Evidence from China’s publicly listed companies in
1997–2010. Academy of Management Journal, 59(5), pp.1845-1868.

73
DEPARTURE OF A CEO
Zhang, Y. and Wiersema, M.F., 2009. Stock market reaction to CEO certification: The signaling
role of CEO background. Strategic Management Journal, 30(7), pp.693-710.
Zuckerman, E.W., 1999. The categorical imperative: Securities analysts and the illegitimacy
discount. American journal of sociology, 104(5), pp.1398-1438.

74
DEPARTURE OF A CEO
Bibliography
Aksu, B., 2016. Impact of Venture Capitalists on Founder Turnover: Implications for Firm
Governance. Strategic Management Quarterly, 4(2), p.11.
Bernard, Y., Godard, L. and Zouaoui, M., 2018. The Effect of CEOs’ Turnover on the Corporate
Sustainability Performance of French Firms. Journal of Business Ethics, 150(4), pp.1049-1069.
Bolino, M.C. and Grant, A.M., 2016. The bright side of being prosocial at work, and the dark
side, too: A review and agenda for research on other-oriented motives, behavior, and impact in
organizations. The Academy of Management Annals, 10(1), pp.599-670.
Bozionelos, N. and Mukhuty, S., 2015. Why CEOs Resign: Poor Performance or Better
Opportunities?. Academy of Management Perspectives, 29(1).
Campbell, G., 2015. Actively developing future CEOs: Boards need to ensure it
happens. Governance Directions, 67(4), p.213.
Cao, X., Pan, X., Qian, M. and Tian, G.G., 2017. Political capital and CEO entrenchment:
Evidence from CEO turnover in Chinese non-SOEs. Journal of Corporate Finance, 42, pp.1-14.
Ertimur, Y., Rawson, C., Rogers, J.L. and Zechman, S.L., 2018. Bridging the gap: Evidence
from externally hired CEOs. Journal of Accounting Research, 56(2), pp.521-579.
Govaerts, Y.M., 2015. Sand dune ridge alignment effects on surface BRF over the Libya-4
CEOS calibration site. Sensors, 15(2), pp.3453-3470.
Gupta, V.K., Han, S., Mortal, S.C., Silveri, S.D. and Turban, D.B., 2018. Do women CEOs face
greater threat of shareholder activism compared to male CEOs? A role congruity
perspective. Journal of Applied Psychology, 103(2), p.228.

75
DEPARTURE OF A CEO
HomRoy, S., 2015. Are CEOs replaced for poor performance? Effects of takeovers and
governance on CEO turnover. Scottish Journal of Political Economy, 62(2), pp.149-170.
Kang, J., 2016. Labor market evaluation versus legacy conservation: What factors determine
retiring CEOs' decisions about long‐term investment?. Strategic Management Journal, 37(2),
pp.389-405.
Kiefer, M., Jones, E.A. and Adams, A.T., 2017. Shareholders and managers as principal-agent
hierarchies and cooperative teams. Qualitative Research in Financial Markets, 9(1), pp.48-71.
Liu, A.X., Liu, Y. and Luo, T., 2016. What drives a Firm’s choice of product recall remedy? The
impact of remedy cost, product hazard, and the CEO. Journal of Marketing, 80(3), pp.79-95.
Milanes, C.M.R., Ullah, S. and Walker, T., 2018. CEO turnover after poor performance:
turnaround or scapegoating?. International Journal of Accounting and Finance, 8(1), pp.1-37.
Wright, P., 2017. Does a CEO's Departure Trigger a Crisis for a CNO?. Nursing administration
quarterly, 41(3), pp.233-236.