CEO Reciprocal Interlocks in French Corporations

In France the chairperson of the board is most often the firm's CEO. This position strengthens the insiders' hold on the board of directors. Moreover, a large fraction of outside directors is composed of CEOs of other firms. The reciprocal interlocking of CEOs creates the possibility of mutual interdependence of CEOs. We investigate factors explaining reciprocal interlocking directorates of CEOs in French corporations. Our results indicate that CEOs of larger firms hold more reciprocal CEO interlocks and when CEOs have more outside directorships, CEOs hold more reciprocal relationships. We also find a positive relationship between the number of CEOs reciprocal interlocks and their firms' performance measured by ROA. We find evidence that CEOs hold more reciprocal interlocks when a blockholder is present on the CEO's board. [PUBLICATION ABSTRACT]