UNDERSTANDING CONTEXT, MODERATORS, AND IMPLICATIONS OF EXECUTIVE TURNOVER IN NONPROFIT ORGANIZATIONS

Turnover among organizational executives is one of the central issues confronting the public, nonprofit, and private sectors. Leaders from the Baby-Boomer generation are set to retire, and others continue to exit due to the high-stress nature of the position. Nonprofit research has broadly explored executive turnover, but has not fully examined the impact of executive turnover on organizations, including their financial performance. This dissertation research seeks to help fill these gaps. Specifically, my research focuses on two related questions: (1) What contextual factors contribute to different turnover outcomes in nonprofit organizations and in what way?; and (2) How does turnover influence the financial performance of nonprofit organizations? This study uses mixed methods and a combination of primary and secondary data. First, a large-N panel of nonprofit financial data was extracted and analyzed quantitatively using multiple regression techniques. In addition, I conducted semi-structured interviews with forty nonprofit executives to explore the rich context of turnover and the range of outcomes executive turnover can produce. This study finds that following a turnover event nonprofit organizations face a slight reduction in expenses, about 4% on average among the organizations in the sample, but the turnover event does not contribute to nonprofit financial instability. Findings stress the importance of an engaged boards of directors, strategically-oriented transitions, staff and stakeholder management, and attention to the relay between the outgoing and incoming executives. This study makes theoretical and empirical contributions to the academic literature on executive turnover as it examines contextual factors unique to nonprofit organizations and general to executive research. For nonprofit scholarship, this study contributes empirical support to our practical understanding of nonprofit executive turnover, and adds to nonprofit financial research by relating turnover to nonprofit performance using financial indicators. It also has important practical implications by informing executives, boards of directors, and other stakeholders on how to prepare and respond to executive turnover so that missions are advanced and resources protected without significant financial disruption.