Publication Type

Journal Article

Version

acceptedVersion

Publication Date

4-2017

Abstract

We investigate a particular aspect of CEO successor trustworthiness that may be critically important after a firm has engaged in financial misconduct. Specifically, drawing on prior research that suggests that facial appearance is one critical way in which trustworthiness is signaled, we argue that leaders who convey integrity, a component of trustworthiness, will be more likely to be selected as successors after financial restatement. We predict that such appointments garner more positive reactions by external observers such as investment analysts and the media because these CEOs are perceived as having greater integrity. In an archival study of firms that have announced financial restatements, we find support for our predictions. These findings have implications for research on CEO succession, leadership selection, facial appearance, and firm misconduct.

Keywords

Firm misconduct, Leader selection, CEO integrity, Facial appearance, CEO succession

Discipline

Human Resources Management | Leadership Studies | Organizational Behavior and Theory | Strategic Management Policy

Research Areas

Strategy and Organisation

Publication

Journal of Applied Psychology

Volume

102

Issue

4

First Page

617

Last Page

635

ISSN

0021-9010

Identifier

10.1037/apl0000172

Publisher

American Psychological Association

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1037/apl0000172

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