Empirical Study of the Impact of Supervisor Board Characteristics to Executive Changes in Listed Companies

By 1368 sub-samples of general manager changes in 444 Chinese listed companies from 1998 to 2008, this paper used panel LOGIT model to empirically inquiry the impact of corporate Supervisor Board to the mechanism of executive changes and found that supervisor board played an important role in executives changes of listed companies. The stock holding of Supervisor Board had significantly positive correlation with the executive changes; there was a significant negative correlation between the size of Supervisor Board and the executive changes. This paper argues that companies need to rationalize the size of the supervisor board, small-scale Supervisor Board is more efficient in the decision of executive changes; members of the supervisor board in listed companies should be encouraged to hold the Company shares; listed companies in equity-based incentives for executives should not simply consider the incentive effects, should also be fully taken into account for the infirmness of the executives changes mechanism. This paper´s contribution is to effectively extend the range of the related research of internal control mechanism in listed companies.