Mind the chair-CEO age dissimilarity: an implicit internal monitoring mechanism

ABSTRACT

Age dissimilarity is an important indicator of executives’ heterogeneity and cognitive conflict. Using Chinese-listed firms between 2005 and 2020 as sample, this paper finds that greater chair–CEO age dissimilarity results in more board monitoring and higher firm value. In addition, the board monitoring plays a mediating role in explaining the relationship between age dissimilarity and firm value. However, the effect of age dissimilarity may be opposite when the chairman is younger than the CEO.

KEYWORDS:

• Corporate governance
• age dissimilarity
• monitoring
• firm value

JEL CLASSIFICATION:

• G39
• M21

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This work is supported by the Humanities and Social Sciences Research Project of the Ministry of Education (No. 21YJC630027).