The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

We exploit a unique data set to study individual characteristics of CEO candidates for companies involved in buyout and venture capital transactions and relate these characteristics to subsequent corporate performance. CEO candidates vary along two primary dimensions: one that captures general ability and another that contrasts communication and interpersonal skills with execution skills. We find that subsequent performance is positively related to general ability and execution skills. The findings expand our view of CEO characteristics and types relative to previous studies.THEORISTS HAVE LONG ASSUMED that CEOs have heterogeneous talents and abilities that map into firm performance. For example, Rosen (1981), Murphy and Zabojnik (2004), and Gabaix and Landier (2008) all model CEOs with different qualities. Empirical studies confirm that managerial heterogeneity is important for corporate actions and performance. For example, Bertrand and Schoar (2003), Adams, Almeida, and Ferreira (2005), and Bennedsen, Pérez-González, and Wolfenzon (2008) find evidence that specific CEOs matter. However, neither theoretical nor empirical studies provide much guidance concerning which particular characteristics and abilities are important for corporate governance and performance.A few theories identify specific managerial characteristics. Bolton, Brunnermeier, and Veldkamp (2008) develop a theory of leadership that contrasts managerial resoluteness against communication and listening skills. Resoluteness is a form of overconfidence that arises when CEOs are unresponsive to outside information. In the paper, the authors analyze the tradeoff between adapting to new information and coordinating employees. Their analysis concludes that more resolute and overconfident CEOs perform better * Kaplan is with University of Chicago Booth School of Business and NBER. Klebanov is with Ziff Brothers Investments. Sorensen is with Columbia Business School and NBER. We thank Geoff Smart and Randy Street of ghSMART for providing the data and for helpful discussions and comments. We thank

The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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