The effect of the announcement of changes in top management on share returns and financial performance of New Zealand companies. (2001)
AuthorsChiewanichakorn, Methineeshow all
This study addresses the issue of the importance of the board of directors in the mechanism of Corporate governance. In this context the effects of changes in top management (appointment, resignation and retirement) on share returns and firm financial performance in New Zealand companies are examined employing event study methodology and regression analyses respectively. It is concluded that the appointment and the resignation of directors have a significant impact on the share returns. The results also show that the small firms tend to experience a greater impact from the change in directors than large firms. However, no significant effect have an impact on the long-term financial performance ofthe firm.