Shareholder wealth effects of CEO departures: evidence from the UK

Elisabeth Dedman, Stephen W.-J Lin

Research output: Contribution to journalArticle (journal)peer-review

55 Citations (Scopus)


This paper examines share price behaviour surrounding announcements of CEO departures from UK firms listed on the All Share Index between 1990 and 1995. We find that many firms choose not to announce CEO departures, and that these firms have poorer performance records, and higher chances of future failure, than those firms who officially announce CEO turnover to the London Stock Exchange. The market reacts negatively to announcements of top executive departures, especially when the CEO is dismissed or leaves to take up another job. Share price reactions to the disclosure of top executive departure are significantly affected by the financial risk of the firm and whether the board announces a replacement CEO.
Original languageEnglish
Pages (from-to)81-104
JournalJournal of Corporate Finance
Issue number1
Publication statusPublished - 31 Jan 2002


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