Political ideology of the board and CEO dismissal following financial misconduct
研究了董事会成员的政治意识形态如何影响财务违规后是否解雇CEO，发现保守派董事会比自由派更可能解雇CEO，基于归因和威胁管理倾向。
Abstract Research Summary Why do some boards refuse to take serious action against CEOs who have committed financial misconduct? Past work has directed attention to the antecedents of misconduct while largely overlooking this question. The relatively few studies that examined it have typically revolved around agency arguments. This study instead examines how the beliefs and values held by board members can influence their actions following financial misconduct. Focusing on political ideology, we argue that politically conservative boards are more likely to respond by dismissing the CEO than are liberal boards as the result of ideo‐attribution and threat management tendencies. Using data from S&P 1500 firms that were involved with financial misconduct, we find support for our arguments while addressing sample‐induced endogeneity and alternative explanations with additional analyses. Managerial Summary Despite criticism from stakeholders, the public, media, and policy makers, many firms do not take serious action against CEOs who have committed financial misconduct. Past studies have suggested that this is due to board structures (e.g., lack of board independence) or situations surrounding misconduct (e.g., severity of misconduct). We propose that political ideology, a set of beliefs and values, held by board members, influences whether firms dismiss their CEOs following financial misconduct. Examining S&P 1500 firms that were involved in financial misconduct, we find that politically conservative boards tend to dismiss their CEOs more often than do liberal boards, offering practical implications for how the ideology of board members can influence critical actions that they take. A video abstract is available at https://youtu.be/P7ew1aJjsdY .