Attractive CEOs boost share prices

Last updated 10:22 08/01/2014
Marissa Mayer
SHARE BOOST: Yahoo boss Marissa Mayer is among the top five in a survey of attractive chief executives.

Relevant offers

World

After parents' outcry, Target pulls 'sexist' Batgirl t-shirt Fraud of the rings hits back at Tolkien's estate Outgoing National MP Maurice Williamson picks up plum LA diplomatic posting How the EU's ruling on Apple explains why Brexit happened Teacher says he was victim of racial discrimination at top Australian school Dubai's ruler orders management shake-up after absences Q&A-Why the EU says Apple must pay Ireland NZ$20 billion in tax Apple must pay up to NZ$20 billion in back taxes in Ireland - European Commission Apple could face billions in European back taxes Bidding hots up for huge Australian Kidman farm as Gina Rinehart steps in

A university study has found that companies can boost their share prices by hiring good-looking chief executives.

Economists at the University of Wisconsin, Joseph Halford and Hung-Chia Hsu, found a positive correlation between a company's stock performance and their chief executive's "facial geometry".

The study, Beauty is Wealth: CEO Appearance and Shareholder Value, used a "facial attractiveness index" to value the appearance of 677 chief executives from the stock market index S&P 500.

It found that "attractive" bosses receive better total compensation and can improve share prices on their first day by creating a good first impression.

The research also suggested that they perform better on the negotiating table, and are more likely to land good deals.

Regular media appearances can also improve shares if the chief executive is attractive, the study found.

"CEO attractiveness may also affect shareholder value through the visibility channel, in which media attention may affect a firm's investor base and stock prices," it said.

"We find that more attractive CEOs are associated with better stock returns on CEO-related television news days."

Speaking to CNBC, the researchers said that Marissa Mayer, the 38-year-old chief executive of Yahoo, was a good example, while being quick to stress that chief executives' attractiveness is only a small part of share performance.

Since Mayer charge of Yahoo!, the company's shares have risen by more than 150 per cent.

"She scored 8.45 (out of 10) in our facial attractiveness index and is among the top 5 per cent in our sample," they said.

"Of course, we don't mean that all the increase in stock price is from her appearance. We just find that there might be some positive correlation between the two."

Ad Feedback

- Sydney Morning Herald

Special offers

Featured Promotions

Sponsored Content