An Empirical Examination of The Relationship Between the Background Characteristics of The CEO and Overall Corporate Reputation

Abstract

This paper examines the relationship between the overall corporate reputation of an organization and the background characteristics of the Chief Executive Officers (CEOs) across twenty-one major industry classifications. Four background characteristics are examined: (1) age, (2) tenure with the company, (3) tenure as CEO, and (4) functional background (career path). These characteristics are explored by examining the overall corporate reputation of the organization through a proxy, the Fortune Corporate Reputation Index. Drawing on past research in the area of background characteristics (Hambrick and Mason, 1984) and corporate reputation (Fombrun and Shanley, 1990), hypotheses were tested which examined the background characteristics of CEOs and the company’s overall corporate reputation. The results of this paper show that, in general, the CEO's background characteristics impact the level of overall corporate reputation of the firm. The type of functional background of the CEO has a significant positive impact on the level of overall corporate reputation. Over a four-year time period (1990 to 1994), age, tenure with the company, and tenure as CEO were negatively related to the overall corporate reputation of organizations that retained their CEO. For firms that had replaced the CEO, a positive relationship between overall corporate reputation and tenure with the company and age was discovered.