Aesthetic Leadership: The Influence of CEO Attractiveness on Bank Loan Contracts
ABSTRACT Facial traits constitute a significant source of information in social interactions, yet little is known about whether they affect borrowing costs. This study examines how CEO attractiveness influences loan costs. Our analysis reveals that firms with more attractive CEOs secure lower loan spreads. To address endogeneity, a difference‐in‐differences approach centred on CEO turnovers confirms robustness. Further analysis shows a significant positive association between CEO attractiveness and operating cash flow, supporting the notion that visually appealing CEOs enhance firm profitability and improve lenders' perceptions of creditworthiness. These findings underscore CEO appearance as an important intangible asset in shaping firm credit terms.
Authors
- Ju‐Fang Yen (ORCID: https://orcid.org/0000-0002-7351-5254)
- Chih‐Yung Lin (ORCID: https://orcid.org/0000-0002-7407-7794)
- Po‐Hsin Ho
- Yao Du
Institutions
- National Yang Ming Chiao Tung University (TW)
- National Central University (TW)
- National Taipei University of Business (TW)
- Hangzhou Dianzi University (CN)
- National Taipei University (TW)
Publication Details
- Journal
- European Financial Management
- Published
- 2025-06-03
- DOI
- https://doi.org/10.1111/eufm.12565
- Primary Topic
- Art History and Market Analysis
- Type
- article
- Field-Weighted Citation Impact
- 0.00