Please address media inquiries to:
phone: +49 345 7753-720
e-mail: presse@iwh-halle.de
Team Public Relations
'Rust in peace': Why are Germany’s bridges and schools falling apart?Oliver HoltemöllerThe Guardian, June 3, 2025
Institutional common ownership of firm pairs in the same industry increases the likelihood of a preexisting social connection among their CEOs. We establish this relationship using a quasi-natural experiment that exploits institutional mergers combined with firms’ hiring events and detailed information on CEO biographies. In addition, for peer firms, gaining a CEO connection from a hiring firm’s CEO appointment correlates with higher returns on assets, stock market returns, and decreasing product similarity between companies. We find evidence consistent with common owners allocating CEO connections to shape managerial decisionmaking and increase portfolio firms’ performance.
