The burden of celebrity: The impact of CEO certification contests on CEO pay and performance

James B. Wade, Joseph F. Porac, Timothy G. Pollock, Scott D. Graffin

Research output: Contribution to journalReview article

229 Scopus citations

Abstract

We used the results from Financial World's widely publicized certification contest, CEO of the Year, to investigate the impact of such contests on firm performance and executive compensation. A certification contest ranks actors on performance criteria that key stakeholders accept as credible and legitimate. We found that certified CEOs received higher compensation than noncertified CEOs when performance was high but lower remuneration when performance was poor. Although certifications appear to generate positive abnormal returns when they are first announced, the longer-term impact of CEO certifications appears to be negative.

Original languageEnglish (US)
Pages (from-to)643-660
Number of pages18
JournalAcademy of Management Journal
Volume49
Issue number4
DOIs
StatePublished - Aug 2006

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Business, Management and Accounting(all)
  • Strategy and Management
  • Management of Technology and Innovation

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