CEO values and corporate performance: A text mining and LLM-based approach

This study examines the effects of CEO values on corporate performance across five standard dimensions of companies’ activity: liquidity, profitability, solvency, operating efficiency, and valuation. Utilising two complementary approaches – dictionary-based text mining and a ChatGPT-based approach to analyse over 4900 CEO interviews, we identified the CEO Schwartz value profiles and compared them with corporate outcomes. We found that CEOs prioritising the Achievement value enhance corporate profitability. In turn, CEOs with a strong orientation toward Security mostly tend to prioritise financial liquidity and long-term value creation, potentially sacrificing short-term profits. Additionally, CEOs emphasising Self-direction or Stimulation maintain higher cash reserves, with less focus on operating efficiency. The results show that CEOs’ values may lead to different strategies and, as a consequence, differences in companies' financial results. Additionally, the results enable better understanding of the sources of these differences.