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Global value

Global value

Mason A. Carpenter

We were delighted to see front-cover attention paid to the bottom-line benefits that internationally seasoned CEOs can deliver (“The Global CEO.” January/February 2004). Our research on Fortune 500 firms, started nearly a decade ago, clearly shows they perform better when the chief executive has overseas experience. However, the full economic value surfaces only when other top management team members also have paid their dues abroad.

Our findings also back up Roger Kenny’s critique of succession planning (“Succession Planning: Still Broken”). A dearth of corporate bench strength carries negative implications for profitability, especially when “bench strength” factors in international experience.

And since boards are increasingly under pressure to link CEO pay to performance, your readers might find it rewarding to discover that CEOs with international experience actually capture a portion of their firms’ performance advantages through higher compensation. Indeed, time abroad really does pay.

Mason A. Carpenter

Associate Professor of Strategic Management University of Wisconsin-Madison

W. Gerry Sanders

Hal B. Gregersen

Brigham Young University

COPYRIGHT 2004 Chief Executive Publishing

COPYRIGHT 2004 Gale Group