Rx for Legal Troubles: CEO Medical Degree and Corporate Litigation

IF 4.6 3区管理学 Q1 BUSINESS

Corporate Governance-An International Review Pub Date : 2024-10-21 DOI:10.1111/corg.12626

Omer Unsal

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引用次数: 0

Abstract

Research Question/Issue

This study examines the relationship between CEOs' medical degrees (MDs) and corporate litigations targeting US pharmaceutical firms.

Research Findings/Insights

CEOs with a medical background are significantly more susceptible to securities class actions, while facing fewer patent lawsuits. The results indicate that the lack of management skills among MD CEOs comes at the cost of firm value. After lawsuit announcements, companies led by MD CEOs experience a significantly negative effect on their stock prices. Markets show no tolerance for failures by MD CEOs, as evidenced by the impact of clinical trial disappointments.

Theoretical/Academic Implications

The findings contribute to our understanding of the impact of CEOs' medical backgrounds on corporate litigation outcomes. The results suggest that when examining how a CEO's qualifications affect legal issues and the value of a company, we should consider the unique context of having an MD.

Practitioner/Policy Implications

Practically, the study implies that firms should carefully consider the balance of managerial and medical expertise in CEO appointments, recognizing the potential legal and financial consequences. Policymakers might see it as beneficial to encourage a mix of different skills among top executives. This could make pharmaceutical companies more resilient in the face of legal issues, which, in turn, helps maintain confidence among investors.

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法律问题解决方案：首席执行官医学学位和公司诉讼

本研究考察了ceo的医学学位与针对美国制药公司的企业诉讼之间的关系。具有医学背景的ceo更容易受到证券集体诉讼的影响，同时面临的专利诉讼也更少。研究结果表明，MD ceo管理技能的缺乏是以企业价值为代价的。MD首席执行官（ceo）领导的公司在宣布诉讼后，股价会受到明显的负面影响。临床试验结果令人失望的影响证明，市场对医学首席执行官的失败没有容忍度。研究结果有助于我们理解ceo的医学背景对公司诉讼结果的影响。研究结果表明，在研究首席执行官的资格如何影响法律问题和公司价值时，我们应该考虑拥有医学博士的独特背景。实际上，研究表明，公司应该仔细考虑在首席执行官任命中管理和医疗专业知识的平衡，认识到潜在的法律和财务后果。政策制定者可能会认为，鼓励高管混合使用不同技能是有益的。这可能使制药公司在面对法律问题时更有弹性，进而有助于维持投资者的信心。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Corporate Governance-An International Review Multiple-

CiteScore

7.00

自引率

11.30%

发文量

期刊介绍： The mission of Corporate Governance: An International Review is to publish cutting-edge international business research on the phenomena of comparative corporate governance throughout the global economy. Our ultimate goal is a rigorous and relevant global theory of corporate governance. We define corporate governance broadly as the exercise of power over corporate entities so as to increase the value provided to the organization"s various stakeholders, as well as making those stakeholders accountable for acting responsibly with regard to the protection, generation, and distribution of wealth invested in the firm. Because of this broad conceptualization, a wide variety of academic disciplines can contribute to our understanding.