In this paper we initiate a new debate concerning the potential effect of CEO personal characteristics on their firms' value. Using a stochastic frontier approach, we essay to derivate the optimal firm value Q* and compute the observed Q value, we then explain the shortfall (Q*-Q) which represents the inefficiency term. Departing from 53 firms from 17 countries publicly traded during 2000–2011, we empirically demonstrate that managerial traits can largely explain the distortion on firm value. The paper also provides the optimal CEOs characteristics that can avoid such distortions.
展开▼
