Does the Market Value CEO Styles?

Schoar, Antoinette; Zuo, Luo

doi:10.1257/aer.p20161031

Cited by 61 publications

(31 citation statements)

References 26 publications

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“…We therefore include Gender in the model, which equals 1 if the CEO is female, and 0 if male. Further, Schoar and Zuo (2016) show that managers who begin their careers during recessions tend to be more conservative; we therefore include…”

Section: Effect Of Ceo Narcissism On Tonementioning

confidence: 99%

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Hear Me Write: Does CEO Narcissism Affect Disclosure?

2018

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Through earnings announcements, conference calls, and other press releases, corporate executives have an opportunity to frame the narrative of financial disclosures. Numerous studies have shown that textual tone significantly influences stock returns, suggesting that through word choice, upper management may impact market reaction. In this study, we examine the influence of CEO personality traits on corporate disclosures by analyzing the tone of earnings announcements for a sample of Fortune 500 CEOs over nearly two decades. Our hypotheses are twofold: 1) that qualitative disclosures in firms with narcissistic leaders will be biased upward and 2) the bias will moderate as CEOs becomes older. Our empirical results support these hypotheses and suggest that more narcissistic CEOs tend to reinforce their grandiose self-image by issuing more positive earnings announcements but this desire wanes with CEO age. We also find that the stock market response to the tone of the earnings announcement is less pronounced for more narcissistic CEOs, suggesting the market takes into account the bias in narcissistic CEO announcements.

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Section: Effect Of Ceo Narcissism On Tonementioning

confidence: 99%

“…Risk is the standard deviation of monthly stock return for the past twelve months. Schoar and Zuo (2016).…”

Section: Descriptive Statistics and Correlationsmentioning

confidence: 99%

Hear Me Write: Does CEO Narcissism Affect Disclosure?

2018

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“…Corporate leaders' ethics may affect corporate governance mechanisms and corporate governance performance. The characteristics of a CEO can lead to good employee behavior, such as obeying the law and conducting ethical behavior [34]. The recent turbulence caused by the founder of Tesla is a fresh example of how reckless announcements from the CEO might hurt the value of a world-class company.…”

Section: Mainstream Research Topics Of Corporate Governancementioning

confidence: 99%

Strengthen Financial Holding Companies’ Business Sustainability by Using a Hybrid Corporate Governance Evaluation Model

Huang¹,

Shen²,

Shieh³

et al. 2018

Preprint

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While the importance of corporate governance has been broadly acknowledged in global financial markets and academic research, how to devise a practical evaluation system is relatively unexplored. This paper attempts to refine the Corporate Governance Evaluation System (CGES), constructed by the Taiwan Stock Exchange (TWSE) since 2014. The current CGES has several debatable issues in its complicated design (e.g., it comprises over 80 indicators in different types). To resolve those issues, this study invited ten senior domain experts (including several CEOs of financial holding companies) to retrieve 13 essential criteria from the CGES in four dimensions. And this study integrates several multiple criteria decision-making (MCDM) methods (i.e., Decision-making trial and evaluation laboratory (DEMATEL), modified VIKOR, DEMATEL-based analytical network process (DANP)) and the fuzzy evaluation technique to rank the exemplary companies. The obtained ranking is consistent with the one released from the CGES in 2017. This study conducted additional experiments to ensure the robustness of the findings. The newly devised model not only supports the ranking decisions but also provides a managerial guidance for companies to pursue systematic improvements. These findings enrich the understanding of corporate governance and contribute to gaining business sustainability for financial holding companies.

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“…Dittmar and Duchin () find that firms run by CEOs who experienced financial difficulties save more cash and have significantly lower net debt ratios. Schoar and Zuo (, ) further show recession CEOs manage smaller firms, receive lower compensation, and display more conservative styles, but market assigns a positive and economically meaningful value to the selection of a recession CEO.…”

Section: Introductionmentioning

confidence: 99%

Boom‐Baby CEOs, Career Experience, and Risk Taking: A Natural Experiment Using Chinese CEOs’ Growth Paths

et al. 2018

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China's economy represents a unique experimental environment, in that it has undergone a successful transformation from a planned to a more open system. Leveraging this natural experimental setting, this study examines the impacts of CEOs’ formative experiences on their risk‐taking behavior. Two events likely constitute formative experiences for CEOs: economic reforms that commenced in 1978 and their prior career experiences. In turn, CEOs’ risk tolerance attitudes likely reflect the influences of these significant events. The results show that CEOs who experienced economic reforms in their early adult life exhibit higher risk‐taking likelihood and greater risk tolerance than those who grew up during the planned economy era. Furthermore, firm performance achieved by CEOs’ risk taking is significantly better when CEOs originally started working in and then remained within business sectors.

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Does the Market Value CEO Styles?

Cited by 61 publications

References 26 publications

Hear Me Write: Does CEO Narcissism Affect Disclosure?

Hear Me Write: Does CEO Narcissism Affect Disclosure?

Strengthen Financial Holding Companies’ Business Sustainability by Using a Hybrid Corporate Governance Evaluation Model

Boom‐Baby CEOs, Career Experience, and Risk Taking: A Natural Experiment Using Chinese CEOs’ Growth Paths

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Does the Market Value CEO Styles?

Cited by 61 publications

References 26 publications

Hear Me Write: Does CEO Narcissism Affect Disclosure?

Hear Me Write: Does CEO Narcissism Affect Disclosure?

Strengthen Financial Holding Companies&rsquo; Business Sustainability by Using a Hybrid Corporate Governance Evaluation Model

Boom‐Baby CEOs, Career Experience, and Risk Taking: A Natural Experiment Using Chinese CEOs’ Growth Paths

Contact Info

Product

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Strengthen Financial Holding Companies’ Business Sustainability by Using a Hybrid Corporate Governance Evaluation Model