Description
This paper examines whether CEOs with general managerial skills are better at achieving the goals of external communication. Using the General Ability Index developed by Custodio, Ferreira, and Matos (2013) to measure CEOs' general managerial skills, I find that firms with generalist CEOs are more likely to obtain the desired outcomes of communication, including the smaller difference between analyst forecasts and management guidance, less dispersion in analyst forecasts, higher analyst following, and higher institutional ownership, after controlling for CEO talent and the impact of Regulation FD. Moreover, I provide direct evidence that general managerial skills are more important to external communication under poor information environments. I also investigate the characteristics of analysts who follow firms with generalists, and my findings suggest the private interaction with analysts is an important communication channel for generalists. Finally, I find that generalists are able to attract dedicated investors and gain long-term capital for their firms. Overall, I provide evidence on the growing importance of general managerial skills in external communication. This paper offers new insights into why CEOs with general skills are paid at a premium over those with specific skills, as documented in previous studies.
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Details
Title
- General managerial skills and external communication
Contributors
- Yeh, Eugenia (Author)
- Hillegeist, Steve (Thesis advisor)
- Brown, Jennifer (Committee member)
- Custodio, Claudia (Committee member)
- Arizona State University (Publisher)
Date Created
The date the item was original created (prior to any relationship with the ASU Digital Repositories.)
2015
Subjects
Resource Type
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Note
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thesisPartial requirement for: Ph. D., Arizona State University, 2015
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bibliographyIncludes bibliographical references (pages 36-42)
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Field of study: Accountancy
Citation and reuse
Statement of Responsibility
by Eugenia Yeh