CEO power and post-merger performance in the UK: the moderating effects of corporate governance mechanisms

Abstract This study examines the effects of Chief Executive Officer (CEO) power and the moderating role of corporate governance mechanisms on mergers and acquisitions (M&A) performance. Our results indicate that CEO power is negatively associated with post-merger performance. Further tests show that corporate governance mechanisms, namely—board size, board independence, and board gender diversity—moderate the negative effects of CEO power on M&A performance. These results imply that internal corporate governance mechanisms may be effective in curtailing CEO power but do not curb it completely. The results are robust across alternative model specifications and alternative measures of post-merger performance.