This study explores CEO selection in business groups, focusing on CEOs as a shared human resource. We expand the traditional classification of family vs. professional CEOs by introducing three types: internal professional CEOs, group-affiliated profes...
This study explores CEO selection in business groups, focusing on CEOs as a shared human resource. We expand the traditional classification of family vs. professional CEOs by introducing three types: internal professional CEOs, group-affiliated professional CEOs, and external professional CEOs. We focus on group-affiliated professional CEOs, who reflect the internal labor market dynamics of business groups. Analyzing data from 148 listed firms in Korean business group during 2014-2021, we find that younger firms are more likely to appoint group-affiliated professional CEOs. These CEOs help improve firm performance and tend to have short tenures before moving. These findings illustrate how business groups strategically utilize executive talent, highlighting the important role of group-affiliated professional CEOs as shared internal resources within the group.