Professor & Merves Senior Research Fellow, Accounting
TOPIC: The Benefits of Being Friends with the Boss
Professor Steve Balsam, professor at Fox School of Business at Temple, will be presenting on April 1, as part of the Dean’s Distinguished Speaker Series. This is an invite only event. If you are interested in attending, please email Archana Jain (firstname.lastname@example.org).
Steven Balsam, Professor of Accounting and Senior Merves Research Fellow at the Fox School of Business at Temple University, obtained his Ph.D. from the City University of New York (Baruch College) in 1991. His research interests are executive compensation, earnings management, and capital markets. He has written several books on executive compensation including Executive Compensation: An Introduction to Practice and Theory, and an AICPA self study course, Accounting for Stock Options and Other Stock-Based Compensation.
He has published articles in academic journals including The Accounting Review, Journal of Accounting Research, Journal of Accounting and Economics, Contemporary Accounting Research, Journal of the American Taxation Association, Auditing: A Journal of Practice and Theory, Accounting Horizons, Journal of Accounting and Public Policy, Journal of Accounting, Auditing and Finance, Journal of Financial and Quantitative Analysis, Journal of Business Finance & Accounting, and Journal of Corporate Finance; and practitioner journals including the Journal of Accountancy.
Professor Balsam is also a member of the editorial boards of Accounting Horizons and the Journal of Accounting and Public Policy. He has been widely quoted in the media and has given expert witness testimony on executive compensation to the United States Senate Committee on Finance. Prior to coming to Temple University he taught at Baruch College and the University of Rochester. Before entering academia he was a Certified Public Accountant working for the international accounting firm of Ernst & Young.
The Benefits of Being Friends with the Boss
We investigate whether connections with the CEO established outside the firm increase the likelihood of an individual being promoted to be on the top management team (TMT), i.e., become one of the firms’ top five executives, and whether those connections increase the likelihood of a member of the TMT being appointed to the board of directors. We find evidence consistent with a connection increasing the likelihood of an individual being appointed to the TMT and the likelihood of a member of the TMT being appointed to the board of directors. We also evidence consistent with connections between the executive and the CEO reducing that executives’ likelihood of turnover. In cross-sectional analysis we provide some evidence consistent with our turnover results being associated with CEO power, as well as firm complexity, and our board appointment results being associated with CEO power.
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