CEO Selection and Executive Appearance

Abstract

Survey assessments have found limited evidence of benefits of executive attractiveness. We use an objective measure of facial attractiveness that is correlated with survey assessments but less noisy and identify several benefits from executive facial attractiveness previously found in the general population but heretofore empirically elusive among executives. We examine the effect of both measures on executive compensation, promotion to CEO and the corresponding shareholder reaction, and promotion to board chair. The objective measure identifies significantly positive labor market effects for executive attractiveness in all outcomes in contrast to survey assessments of attractiveness that do not correlate with any outcome.

The CEO beauty premium: Founder CEO attractiveness and firm valuation in initial coin offerings

“…Our findings contribute to entrepreneurship research by focusing attention on the founder CEO's "beauty premium." While the beauty premium has been documented in fields as diverse as the labor market (Hamermesh & Biddle, 1994), education (Cipriani & Zago, 2011), politics (Berggren et al, 2010), charitable giving (Jenq et al, 2015;Park et al, 2019), finance (Blankespoor et al, 2017;Cao et al, 2020;Price, 2008;Ravina, 2019), and strategy (Cook & Mobbs, 2019;Halford & Hsu, 2020), the effect of founder CEO attractiveness on entrepreneurial outcomes remains relatively underresearched. A few previous studies argue in favor of the existence of an entrepreneurial beauty premium.…”

“…Conversely, other studies in addition to Blankespoor et al (2017) do provide evidence consistent with the existence of a CEO beauty premium. Cook and Mobbs (2019) show that candidate CEOs' facial attractiveness positively influences board directors in their CEO selection decisions. CEOs' attractiveness also relates positively to their compensation and the likelihood of their appointment as chairman within 6 months of their selection as the new CEO.…”

The impact of connections between the CEO and top executives on appointment, turnover and firm value

“…Despite the importance of non‐CEO executives, little research has been done on their appointments and departures. Several studies explore the appointment of CEOs (e.g., Boivie et al., 2016; Cook & Mobbs, 2019; Datta & Guthrie, 1994; Hoitash & Mkrtchyan, 2018) considering both firm and candidate characteristics. Most relevant to this study, Wiersema et al.…”

“…Several studies explore the appointment of CEOs (e.g., Boivie et al, 2016;Cook & Mobbs, 2019;Datta & Guthrie, 1994;Hoitash & Mkrtchyan, 2018) considering both firm and candidate characteristics. Most relevant to this study, Wiersema et al (2018) "finds that candidates who have shared connections and experiences with the CEO .…”

“…Despite the importance of these non‐CEO executives, little research has been done on their appointments and departures. Although several studies explore CEO appointments (e.g., Boivie et al., 2016; Cook & Mobbs, 2019; Datta & Guthrie, 1994; Hoitash & Mkrtchyan, 2018; Wiersema et al., 2018), few papers examine the appointment or promotion of non‐CEO executives (exceptions include Bernard et al., 2021; Boivie et al., 2016; Frederiksen & Kato, 2018; Grabner & Moers, 2013). Likewise, while research has examined the appointment of directors (e.g., J. Cai et al., 2017; Erel et al., 2018; Krause et al., 2017; Westphal & Stern, 2007), we are unaware of any that focus on internal appointments.…”