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Do aggressive CFOs borrow short-term?

Author

Listed:
  • Gam, Yong Kyu
  • Kim, Andy
  • Park, Junho
  • Shin, Hojong

Abstract

We study whether CFOs’ psychological traits affect debt maturity choices. Using facial width-to-height ratio (fWHR) as a proxy for achievement drive, we measure 2494 CFOs and 2408 CEOs from 1992 to 2020. Higher-CFO fWHR predicts significantly shorter debt maturity with larger number of lead managers in syndicated loans, while CEO fWHR has no effect. The relationship is strongest when rollover risk is high and is confirmed in loan-level analyses and survives difference-in-differences test around CFO turnovers. Short-term borrowing by high-fWHR CFOs is not value-destroying: markets react positively, distress risk declines, and these CFOs are more often promoted externally to CEO.

Suggested Citation

  • Gam, Yong Kyu & Kim, Andy & Park, Junho & Shin, Hojong, 2026. "Do aggressive CFOs borrow short-term?," Journal of Behavioral and Experimental Finance, Elsevier, vol. 49(C).
    • Handle: RePEc:eee:beexfi:v:49:y:2026:i:c:s2214635025001029
    DOI: 10.1016/j.jbef.2025.101121
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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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