Does the Education and Experience of CEO Matter? Evidence from M&As Initiated by the Russian Companies

The Journal of the New Economic Association. 2024. No. 3(64). P. 103–127.

E.V. Zagudalova, S.A. Grigorieva, S.A. Zueva

This paper contributes to the present literature by examining the impact of CEO education and experience on M&A performance in Russia. The study is based on a sample of 172 M&A transactions over 2000–2021. We use the event study method to assess the performance of M&A deals and regression analysis to reveal the effects of CEO education and experience on M&A outcomes. CEO education is defined by three variables: financial or economic education; technical education; PhD or MBA status of CEO. CEO’s experience is described by the variables, reflecting previous experience in M&A deals and his (her) industry experience in the target company’s industry. Our results show that economic/financial education of CEO obtained during the Soviet Union has a negative impact on the performance of transactions, while technical education has a positive effect. Interesting positive results were obtained about the presence of an MBA and PhD level in the education of the CEO. Our results also show that the previous deal experience increases the deal performance, while the CEO experience in the target company’s industry reduces it.

Keywords: сделки слияния и поглощения, российский рынок, Russian market, M&A deals, event study, метод событий, персональные характеристики СЕО, CEO education, CEO personal characteristics, CEO experience, образование СЕО, опыт СЕО

Publication based on the results of: Behavioral Corporate Finance in Emerging Capital Markets: Empirical Results of Russian Companies (2022)