Table 2 The effects of a connected CEO...

Table 2

The effects of a connected CEO in the first 12 months, by geography

Variables	Pooled	United States and Commonwealth^a	Europe^b	Asia^c	Rest of the world^d
Market-based effects
CARs
Connected CEO	0.75 (0.00)	0.79 (0.00)	1.01 (0.00)	0.45 (0.54)	0.22 (0.71)
Non-connected CEO	0.73 (0.00)	0.96 (0.00)	−0.26 (0.54)	1.54 (0.10)	−0.21 (0.65)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0019	0.0025	0.0061	0.0115	0.0100
Between R²	0.0766	0.0879	0.2417	0.4224	0.1701
Overall R²	0.0073	0.0067	0.0212	0.0302	0.0192
Accounting-based effects
ROA
Connected CEO	−0.23 (0.13)	−0.43 (0.03)	0.47 (0.02)	0.13 (0.76)	−0.95 (0.00)
Non-connected CEO	0.20 (0.15)	0.26 (0.15)	−0.41 (0.06)	0.46 (0.38)	−0.65 (0.00)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0176	0.0171	0.0991	0.2220	0.1641
Between R²	0.2120	0.2188	0.2010	0.3161	0.3155
Overall R²	0.1702	0.1679	0.1797	0.3190	0.3502
ROIC
Connected CEO	−0.61 (0.00)	−1.02 (0.00)	0.76 (0.01)	1.08 (0.07)	−0.58 (0.05)
Non-connected CEO	0.12 (0.52)	0.37 (0.10)	−0.53 (0.12)	−4.69 (0.00)	−0.76 (0.00)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0212	0.0244	0.0594	0.1113	0.1554
Between R²	0.2240	0.2230	0.1795	0.4879	0.2353
Overall R²	0.1793	0.1728	0.1581	0.3987	0.2606
ROS
Connected CEO	−2.02 (0.01)	−3.41 (0.00)	0.37 (0.40)	6.61 (0.10)	−1.45 (0.05)
Non-connected CEO	−0.78 (0.29)	0.56 (0.55)	−1.97 (0.00)	−57.1 (0.00)	−1.27 (0.04)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0079	0.0121	0.1298	0.2724	0.0795
Between R²	0.2093	0.2266	0.3226	0.5163	0.0394
Overall R²	0.1730	0.1835	0.2860	0.3764	0.0729

Variables	Pooled	United States and Commonwealth^a	Europe^b	Asia^c	Rest of the world^d
Market-based effects
CARs
Connected CEO	0.75 (0.00)	0.79 (0.00)	1.01 (0.00)	0.45 (0.54)	0.22 (0.71)
Non-connected CEO	0.73 (0.00)	0.96 (0.00)	−0.26 (0.54)	1.54 (0.10)	−0.21 (0.65)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0019	0.0025	0.0061	0.0115	0.0100
Between R²	0.0766	0.0879	0.2417	0.4224	0.1701
Overall R²	0.0073	0.0067	0.0212	0.0302	0.0192
Accounting-based effects
ROA
Connected CEO	−0.23 (0.13)	−0.43 (0.03)	0.47 (0.02)	0.13 (0.76)	−0.95 (0.00)
Non-connected CEO	0.20 (0.15)	0.26 (0.15)	−0.41 (0.06)	0.46 (0.38)	−0.65 (0.00)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0176	0.0171	0.0991	0.2220	0.1641
Between R²	0.2120	0.2188	0.2010	0.3161	0.3155
Overall R²	0.1702	0.1679	0.1797	0.3190	0.3502
ROIC
Connected CEO	−0.61 (0.00)	−1.02 (0.00)	0.76 (0.01)	1.08 (0.07)	−0.58 (0.05)
Non-connected CEO	0.12 (0.52)	0.37 (0.10)	−0.53 (0.12)	−4.69 (0.00)	−0.76 (0.00)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0212	0.0244	0.0594	0.1113	0.1554
Between R²	0.2240	0.2230	0.1795	0.4879	0.2353
Overall R²	0.1793	0.1728	0.1581	0.3987	0.2606
ROS
Connected CEO	−2.02 (0.01)	−3.41 (0.00)	0.37 (0.40)	6.61 (0.10)	−1.45 (0.05)
Non-connected CEO	−0.78 (0.29)	0.56 (0.55)	−1.97 (0.00)	−57.1 (0.00)	−1.27 (0.04)
Observations	25,268	18,763	2,705	1,132	2,668
Within R²	0.0079	0.0121	0.1298	0.2724	0.0795
Between R²	0.2093	0.2266	0.3226	0.5163	0.0394
Overall R²	0.1730	0.1835	0.2860	0.3764	0.0729

Note(s): All regressions apply the panel random effects estimator to data winsorized at the 2nd and 98th percentile of the relevant indicator (dependent variable). The explanatory variable (non)connected CEO measures the performance of a new (non)connected CEO in the 12 months after appointment relative to the 12 months before being appointed. Control variables include measures of company health, company size, time, country and industry fixed effects, and a constant term. The p-value of the point estimate is reported in brackets – the significance levels utilize two-tailed tests except the constant

Australia, Canada, United Kingdom and United States

Belgium, Czech Republic, Denmark, Finland, France, Germany, Italy, Norway, Portugal, Spain, Sweden and Switzerland

Hong Kong and Japan

Brazil, India and South Africa

Source(s): Authors’ own work

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