CEO Backgrounds and Stock Performance: Evidence from the Great Recession

Using the Great Recession of 2007-2009 as a quasi-natural experiment, we find that CEOs’ work experience is significantly related to firm stock performance while their endowed traits play a limited role in the recession. No CEO characteristics matter during the pre-recession period. CEOs who experienced more downturns in their incumbent firms’ industries during their careers perform better while CEOs with more diversified work experience perform worse in the recession; firm policies adopted by CEOs explain the former but not the latter finding, which appears to be more related to CEO incentives in the recession.

Keywords: CEO Characteristics, CEO Work Experience, Financial Crisis, Recession

JEL Classification: G30, J24, M10

Suggested Citation: Suggested Citation

Pang, Jiaren and Tice, Sheri and Wang, Lingling, CEO Backgrounds and Stock Performance: Evidence from the Great Recession (January 18, 2016). University of Connecticut School of Business Research Paper No. 18-06, Available at SSRN: https://ssrn.com/abstract=3104573 or http://dx.doi.org/10.2139/ssrn.3104573