Impact of the CEO Age and CSR Score on Mergers and Acquisitions

Abstract: This study intends to combine both the management characteristics and firm’s characteristics to analyse the M&A performance. For the management characteristics, we used the CEO age and for the firm characteristics, we used the CSR score. In order to understand the M&A performance, we conducted an Event Study to predict the abnormal stock returns of the acquiring firm around the announcement of the M&A. The sample consists of European M&As from 2008 to 2018. The study extends not only to the acquirer’s but also to the target’s perspective. The findings for the acquiring company suggest that the M&A performance has a relationship with the CEO age and CSR score both individually and combined. More particularly, M&As have higher performance when the CEO of the acquiring company is old and the CSR score of the acquiring company is high. Finally, our empirical evidence suggests that the market is not concerned about the target characteristics.