IDEAS home Printed from https://ideas.repec.org/a/eee/finana/v97y2025ics1057521924007129.html
   My bibliography  Save this article

Which corporate leaders matter to financial markets?

Author

Listed:
  • Ratliff, David J.
  • Philipps, Collin S.

Abstract

This article uses market volatility effects to answer the question of which leaders matter to financial markets. We use a unique large dataset of over 22,000 management change announcements from S&P 500 companies together with an augmented Fama and French 5-factor model. Rolling ARCH panel regressions identify how idiosyncratic changes in daily stock price volatility are associated with changes in top corporate officers. We find that changes in CEOs, Presidents, and Chairmen increase daily return volatility by 30%–100% on the date of announcement, while CFOs and COOs may also cause some limited market response. Controlling for these five officers eliminates statistically significant correlations between idiosyncratic stock price volatility and other management change announcements such as CIO, CMO and Vice President. We find no evidence that stock price volatility responds differently to leadership change announcements than to other volatility shocks.

Suggested Citation

  • Ratliff, David J. & Philipps, Collin S., 2025. "Which corporate leaders matter to financial markets?," International Review of Financial Analysis, Elsevier, vol. 97(C).
    • Handle: RePEc:eee:finana:v:97:y:2025:i:c:s1057521924007129
    DOI: 10.1016/j.irfa.2024.103780
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1057521924007129
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.irfa.2024.103780?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Volatility; Leadership; Efficient markets;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G35 - Financial Economics - - Corporate Finance and Governance - - - Payout Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finana:v:97:y:2025:i:c:s1057521924007129. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620166 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.