Investors and other stakeholders were understandably sad to see Alan Mulally step down as CEO at age 68 in 2014 after successfully steering at Ford Motor Co. through the 2008-2009 financial crisis, avoiding the fate of rival automakers General Motors and Chrysler. But for every Mulally whose experience and talent are held in high enough esteem to overshadow most concerns about ability to lead effectively into his seventies, there are other CEOs who remain at the helm of big companies far longer than they should.
A recent research paper by Adam Yore and Brandon Cline—assistant professors of finance at the University of Missouri and Mississippi State University, respectively—looks at whether or not mandatory retirement policies for CEOs as viewed as a best practice in corporate governance. In recent years, there has been plenty of attention paid to the need for regular renewal and age diversity on corporate boards, but Yore and Cline couldn’t find prior literature focusing on CEOs.
