14. October 2019 Latest economy and HR news
How a CEO’s personality affects stock prices
Harvard Business Review conducted a study, investigating how the market reacts to CEOs’ personalities. They hypothesized that CEOs’ observable tendencies could significantly influence investors’ perception of the firm and therefore its value. The ‘Big Five’ personality traits were the focus of the study: conscientiousness, neuroticism, extroversion, openness to experience and agreeableness. The study found that there is a correlation between a CEO’s personality and a firm’s stock volatility. The article expands on the exact findings of the study, but they has 2 overall thoughts: first, there is wisdom for managing impressions for CEOs. Second, boards should be aware of personality as a factor when selecting a CEO as it may influence an executive’s potential effectiveness as the face of the company.
The importance of gratitude: CEO writes 9,200 birthday cards a year
Sheldon Yellen, CEO of property-restoration company BELFOR Holdings, Inc., hand-writes birthday cards to every employee as a way of saying thank you. Yellen tells Business Insider, “there is an inside joke with acquisitions that I ask prior to closing: ‘How many more people?’” The effect that this has had on the company has been incredible as Yellen believes that by taking the time to personally thank his employees every day, he has created a culture of compassion through the whole company. Despite criticism from other CEOs that this is a waste of time, career experts say that the best managers are ones that are strong in positive reinforcement and workers also admire traits in their bosses when they pay attention to career accomplishments. Yellen must be doing something right!
US tech giants turn to India for new apps before world release
After two decades covering the Internet sector, RBC Capital Markets’ Mark Mahaney says that India is emerging as the testing and acquisition playground for global consumer technology companies, becoming more popular than China because it has the same growth dynamics but with fewer regulations. For example, Netflix rolled out a mobile plan in India at a much cheaper rate than what it charges for a basic plan in other countries. It has now created original content to capture more market share. There is huge room for growth for US tech giants in India, as Mahaney explains, quoted by The Economic Times, “India is less than 5% of Amazon’s total revenues but it has the potential to get to that level within five years.”
SoftBank in talks to take control of WeWork amid cash crunch
Bloomberg reported that WeWork, which provides shared workspaces for startups, freelancers etc., is considering a bailout that will hand control of the once high-flying startup to SoftBank Group Corp. SoftBank, which is already WeWork’s largest stakeholder, is convinced that it can turn its financial issues around with the right financial control. However, WeWork has another backup plan: they are considering a $5million bailout from JP Morgan Chase & Co. If the board does opt for the SoftBank deal, the Japanese company will be taking on a troubled enterprise at a time that it’s struggling to convince the market about its longer-term investment vision.
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Your Glasford International Deutschland Research and Analytics Team