CEO Selection and Executive Appearance
53 Pages Posted: 17 Jan 2014 Last revised: 19 Dec 2019
Date Written: December 18, 2019
We use a scientifically-based measure of executive facial attractiveness that is correlated with survey assessments, but not as noisy, and find a positive link between attractiveness and CEO selection. We find evidence that better interpersonal relationships is one mechanism through which CEO attractiveness is valuable. Attractive CEOs inform directors more effectively and are more quickly appointed as board chair. We also find that more attractive executives receive higher compensation relative to their peers and that attractiveness is more valuable when executives are otherwise more similarly skilled. Finally, more attractive executives are associated with higher abnormal stock returns around their CEO selection announcement. Overall, facial attractiveness is an important executive trait with significant labor market implications.
Keywords: labor market, CEO selection, attractive, tournaments, facial traits
JEL Classification: G30, G32, G34, G35
Suggested Citation: Suggested Citation