TY - UNPB
T1 - Between Scylla and Charybdis
T2 - CEO Political Ideology, Dividends and Downsizing During the Pandemic
AU - Bayat, Ali
AU - Goergen, Marc
AU - Koutroumpis, Panagiotis
AU - Wei, Xingjie
PY - 2021/12/7
Y1 - 2021/12/7
N2 - We study whether CEO political ideology affected how S&P 500 firms reacted to the Covid-19 pandemic, an exogenous shock to demand and supply. We hypothesize that conservative CEOs are more likely to adopt shareholder-friendly than employee-friendly reactions to the pandemic.Hence, they should be more likely to downsize their workforce while maintaining dividends. In contrast, other CEOs should be less likely to meet dividend expectations and less likely to downsize. We find confirmation of this hypothesis. We also find that CEOs used the dividend forecasts for 2020 as their benchmark rather than the 2019 dividends to make their dividend decision.
AB - We study whether CEO political ideology affected how S&P 500 firms reacted to the Covid-19 pandemic, an exogenous shock to demand and supply. We hypothesize that conservative CEOs are more likely to adopt shareholder-friendly than employee-friendly reactions to the pandemic.Hence, they should be more likely to downsize their workforce while maintaining dividends. In contrast, other CEOs should be less likely to meet dividend expectations and less likely to downsize. We find confirmation of this hypothesis. We also find that CEOs used the dividend forecasts for 2020 as their benchmark rather than the 2019 dividends to make their dividend decision.
KW - CEO Political Ideology
KW - Dividend Policy
KW - Downsizing
KW - Stakeholder Management
KW - Covid-19 Pandemic
UR - https://ecgi.global/working-paper/between-scylla-and-charybdis-ceo-political-ideology-dividends-and-downsizing-during
U2 - 10.2139/ssrn.3977042
DO - 10.2139/ssrn.3977042
M3 - Discussion paper
VL - No. 802/2021
T3 - European Corporate Governance Institute – Finance Working Paper
BT - Between Scylla and Charybdis
PB - European Corporate Governance Institute
ER -