Working Paper: NBER ID: w17940
Authors: David Yermack
Abstract: This paper shows close connections between CEOs' absences from headquarters and corporate news disclosures. I identify CEO absences by merging corporate jet flight histories with records of CEOs' property ownership near leisure destinations. I find that CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. When CEOs are away, companies announce less news than usual, mandatory disclosures are more likely to occur late, and stock prices exhibit sharply lower volatility. Volatility increases when CEOs return to work. CEOs spend fewer days out of the office when their ownership is high and when the weather is bad at their vacation homes.
Keywords: No keywords provided
JEL Codes: G14; G34
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| positive disclosures (G38) | CEO absences (M12) |
| CEO presence (M12) | timely news disclosures (G14) |
| CEO presence (M12) | market stability (D53) |
| CEO absences (M12) | volatility of stock prices (G17) |
| CEO return (M12) | increase in volatility (E32) |
| CEO absences (M12) | less news disclosures (G14) |