Published Online:April 2026
Product Name:The IUP Journal of Applied Economics
Product Type:Article
Product Code:IJAE 030426
DOI:10.71329/IUPJAE/2026.25.2.52-71
Author Name:Ema Garg and Chandrima Sikdar
Availability:YES
Subject/Domain:Economics
Download Format:PDF
Pages:52-71
In recent years, developed economies have increasingly separated the roles of CEO and chairman, while developing countries, including India, are still debating this governance practice. Against this backdrop, this study examines the impact of CEO duality on agency costs in Indian firms using a panel of NSE 500 nonfinancial companies for the period 2010-2025. Measuring agency costs through asset utilization ratio and expense ratio, econometric models are run using system GMM estimations. The results show that CEO duality lowers agency costs by improving asset utilization, supporting stewardship theory, though no effect is found on expense ratio. Firm-size analysis reveals that duality benefits small firms through stronger asset efficiency; but in large firms, it increases agency costs via weaker oversight and managerial entrenchment
CEO duality refers to the situation where a company’s chief executive officer (CEO) also serves as the chairman of its board of directors (Daily & Dalton, 1997). Over the past three decades, it has been one of the most debated issues in corporate governance among market practitioners, lawmakers, researchers, and academicians (Krause et al., 2014)