Beauty and appearance in corporate director elections

Abstract

We study the role of facial appearance in corporate director (re-)elections by means of director photographs published in annual reports. We find that shareholders use inferences from facial appearance in corporate elections, as a better (higher rated) appearance measure of a director reduces voting dissent.These heuristics are based on perceived competence, trustworthiness, likability, and intelligence, but not on physical beauty. The results are valid for director re-elections but not for first appointment elections as in the latter cases, shareholders may not as yet be familiar with a director's looks. In firms with few institutional shareholders and more retail investors owning small equity stakes, the latter tend to rely more on facial appearance than institutional shareholders, presumably as institutions conduct more research on the director's background and performance, and consequently rely less on facial appearance.While female directors generally experience lower voting dissent, their facial appearance does not affect their elections results. JEL Classification: G34, G39, G41

All on board? New evidence on board gender diversity from a large panel of European firms

“…This line of research could utilize difference-in-difference methodology to exploit the quota as a natural experiment, and also offer tremendous insights for policy development. From a methodology standpoint, a growing body of research utilizes perceptions of facial appearance (e.g., beauty, competence) to predict appointments of CEOs and directors, albeit mostly male samples (e.g., Geiler, Renneboog, & Zhao, 2018;Graham, Harvey, & Puri, 2017). Future research could expand this research to female corporate leaders, and explore differences across supervisory and management boards of both public and private firms.…”

“Beauty too rich for use”: Billionaires’ assets and attractiveness

“…Beauty has been shown to improve success in the labor market and in other endeavors in a large variety of occupations, many of which involve populations of highly paid people. Citing only fairly recent studies, these include academics (Babin et al, 2020); celebrities (Gergaud et al, 2012); corporate directors (Geiler et al, 2018); economists (Hale et al, 2021); women professional golfers (Ahn and Lee, 2014); political candidates (Benjamin and Shapiro, 2009;King and Leigh, 2009; Jones and Price, 2017); regional political leaders (Ling et al, 2019); prostitutes (Arunachalam and Shah, 2012); NFL quarterbacks (Berri et al, 2011); professional speedboat racers (Yamamura et al, 2021), and professional tennis players (Bakkenbüll and Kiefer, 2015). With beauty clearly important in so many different areas, why do we find that among billionaires, financial assets are essentially unrelated to beauty?…”