The double-edged sword of CEO/chairperson duality in corporatized state-owned firms : evidence from top management turnover in China

Michael FIRTH, Sonia M L WONG, Yong YANG

Research output: Journal PublicationsJournal Article (refereed)

9 Citations (Scopus)


This study examines how board leadership structure (CEO duality) affects the corporate governance of corporatized state-owned firms where the state shareholders use these firms to serve both profit and non-profit objectives. We propose that CEO duality will generate a positive (negative) significant impact on the firms' corporate governance when state owners tend to monitor their CEOs on the basis of profit (non-profit) considerations. We test our hypotheses by examining the relations between CEO duality and CEO turnover in Chinese listed companies that are ultimately controlled by central or local governments. We find that CEO duality is negatively related to turnover in marginal profit-making firms where turnover would be value-enhancing. This suggests that CEO duality is detrimental to these firms' corporate governance because it entrenches relatively poorly performing CEOs. Duality is also negatively related to turnover in high-profitability firms where turnover would be non-value-enhancing. This suggests that CEO duality might positively contribute to the corporate governance of these firms by reducing the occurrence of non-value enhancing turnover. Overall, our study suggests that CEO duality is a double-edged sword in corporatized state-owned firms.
Original languageEnglish
Pages (from-to)207-244
Number of pages38
JournalJournal of Management and Governance
Issue number1
Early online date1 Jul 2012
Publication statusPublished - Feb 2014



  • Board leadership structure
  • China
  • Corporate governance
  • Duality
  • Top management turnover

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