The Empirical Analysis Of CEO Forced Turnover And The Board Characteristics

The listed companies in China have modern enterprises characteristics that ownership and right of control have been separated. As the owners of company, they need a certain internal control mechanism to monitor and restraint managers, especially for executives. The board, as an internal mechanism, is effective become very important. Jensen says, if the internal control mechanism does no effect, the board will bears this failure responsible. This paper discusses Executives mandatory change to test the board as "watch Dog" whether plays a proper role. The efficiency of corporate governance affects the company's performance directly and the board work effectively and diligent, by which has a pivotal role to its management efficiency. This research's object is the chairman and general manager because they have the most direct responsibility to the company's wealth growth; they are in the top levels in decision-making. Choosing the listed companies'experience data from the year 2006 to year 2009, using the logistic regression model, we analyzed the correlation that the board features and the senior executives mandatory change, examined the efficiency that the board supervise the company executives, provided empirical evidence to optimize the board, eventually played the role of improving the efficiency of corporate governance. The regression results show that, when the company has a inferior performance, not getting salaries directors'percentage is a higher, the board is smaller and the board meeting times is more, that the possibility of the executives mandatory change increase. There is no significant correlation between the executives mandatory change and the leader structure when the chairman and CEO to be one person. The shareholding level of the directors and executives mandatory change is not positively related.