Have CEOs Changed?

Abstract

Using more than 4,900 assessments, we study changes in the characteristics and objectives of CEOs and top executives since 2001.  The same four factors explain roughly half of the variation of assessed CEO characteristics in this larger sample of executive assessments as in Kaplan and Sorensen (2021).  After the global financial crisis (GFC), the average interviewed CEO candidate has lower overall ability, is more execution oriented / less interpersonal, less charismatic and less creative / strategic than pre-GFC.  Except for overall ability and execution oriented / interpersonal, these differences persist in hired CEOs.  Interpersonal or “softer” skills do not increase over time, either for CEO candidates or hired CEOs.  Pre- and post-GFC, we find a positive correlation between the ability of assessed CEOs and other C-level executives assessed at the same company, suggesting that higher-ability executives complement each other.  Finally, we look at the relation between the objectives for which the CEOs are interviewed and CEO characteristics.  

Keywords: Managerial Characteristics, Managerial Hiring Decisions, Demand and Supply of Managerial Talent, Factor Analysis

JEL Classification: G30, J20, M12