Easy going CEOs do better than their uptight counterparts

The study was conducted by researchers at University of British Columbia

Washington: It turns out that CEO's who have a happy-go-lucky attitude and are optimistic do better for their companies, says a new study.

The study conducted by researchers at University of British Columbia, claims that a CEO's natural sunny disposition can have an impact on the way the market reacts to announcements of company earnings.

The study, which is the first to look at the effect of how managers naturally convey themselves as per co-author Jenny Zhang, shows that leaders' inclinations to express themselves with optimism carries over into their tone when disclosing company performance - a tendency that can create an uptick in stock price.

Zhang and her colleagues examined transcripts of earnings reports delivered by managers in conference calls. Their findings revealed that managers whose language displays an optimistic state of mind were more likely to have a positive influence on their firm's position in the market.

The researchers also looked at who tended to be more optimistic, finding that CEOs were more positive than CFOs. Those who began their careers in a recession used less optimistic language. Men tended to convey themselves more positively, as do managers involved with charities.

The study is due to be published in Review of Accounting Studies.

( Source : ANI )
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