EXECUTIVE TAKEAWAYS Executive Takeaways
■ In CEO promotions, nonpromoted executives (NPEs) have lower potential for future promotion. ■ Strong NPEs often subsequently leave the firm due to greater loss of incentives. ■ NPEs in firms that promote an heir apparent are less subject to the issue of NPE turnover. ■ NPEs who leave after a tournament are not always deemed "losers" by the labor market.
Duanping Hong, Assistant Professor of Accounting
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