Study: CEOs Who Run Marathons May Be More Effective

A new study finds a positive association between "fit" CEOs and firm value

The results of a recent German study suggest that high level executives who are "fit" are more likely to run companies with higher firm values.

The lead researchers, Peter Limbach and Florian Sonnenburg, defined CEOs as being “fit” if they had finished one of the 15 biggest U.S. marathons between 2001 and 2011. They hypothesized that executives who are physically fit would exhibit better job performance thanks to exercise benefits like stress management and improved cognitive function.

“Due to its buffering effect on stress and its positive effect on cognitive functions, executive control processes and job performance, fitness should play an important role for CEOs as their jobs are characterized by high, frequently changing demands, far-reaching decisions accompanied by media scrutiny, and high stress,” the paper, published in the Social Science Research Network explains.

After analyzing the firm values for companies on the S&P 1500 index and comparing them to CEO fitness based on the study’s preset definition of “fit”, the researchers found that companies led by CEOs who run marathons are valued between 4 and 10 percent higher than companies led by non-runner CEOs.

In fact, the data revealed that the company values of “fit” CEOS were between 8 and 10 percent higher for specific subcategories of CEOs such as those who are “above-median age (55) and above-median tenure as well as CEOs with high workload.”

“Our findings explain the increasing importance of fitness in the managerial labor market and the recent trend for fitness among executives,” the researchers wrote in the conclusion of their paper. “For example, they provide a rationale for why executive recruiting firms look for physically fit candidates.”

Of course, as corporate governance expert and Stanford professor David Larker pointed out to Outside Online, this strong association doesn’t necessarily mean that firm’s value would decrease if a “fit” CEO were replaced by an out-of-shape executive. 

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