Title : CEO of Busyness and Investment Efficiency: Evidence from Indonesia
Authors:
- Harymawan Faith
- Nadia Klarita Rahayu
- Khairul Anuar Kamarudin
- Wan Adibah Wan Ismail
- Melinda Cahyaning Ratri
Department : Accounting
Journal Name : Journal of Financial Reporting and Accounting
Kinds of Journal : Q1
Keywords : Busy CEO, Risk Management Committee, Investment Efficiency, Governance
Abstract:
PURPOSE - This study aims to explore the relationship between the level of Busyness of Chief Executive Officers (CEOS) and investment efficiency in the context of emerging markets.
Design/Methodology/Approach - The sample includes firms listed on the Indonesia Stock Exchange from 2010 to 2018 Using Ordinary Least Square Estimation.
Finding - The Finding Suggest That Companies LED by Busy Ceos Tend to Exhibit Lower Investment Efficiency, thus providing support for the hypothesis that as ceos' commitments increase, their ability to concentrate on the Company Diminisses. Furthermore, Our analysis Reveals that compatiles with busy ceos tend to demonstrate a greater tendency to over-invest, potentially in response to market pressures to showcase strong performance. A more in-depth Examination of the data show that the negative impact of Busy Ceos on Investment Efficiency is essentially noticeable in Firms Lacking Risk and Management Committee (RMC).
Practical Implications - These Findings have substantive practical implications for the structure and composition of corporate boards. They highlight the significance of conducting comprehensive assessments to gain insights into the external commitments of incoming ceos.
Originity/Value - This Study Underscores The Importance of Establishing RMC.
For details : http://dx.doi.org/10.1108/jfra-02-2023-0083