One Man Two Hats - What's All the Commotion!

Abstract

We examine performance in publicly listed U.K. companies over a period that encompasses issuance of the Cadbury Committee's Code of Best Practice calling for the abolition of the combined CEO and COB position. We find companies splitting the combined CEO and COB position to conform to the Code's requirement did not exhibit any absolute or relative improvement in performance to various peer-group benchmarks. We do not necessarily scoff at mandated board structures, but the evidence appears to be that such legislature coercing the abandonment of the combined CEO and COB position appears to be wide of the mark.