Medical Boards and CEOs
Dunhong Jin, Fangzhou Lu, Sixuan Li, Chao YanAbstract
Approximately 37% of Chinese listed firms possess medical expertise, as indicated by the presence of board members and senior executives with a medical degree or experience in the medical industry. Using the COVID-19 outbreak in China as a natural experiment, we find that the stock returns of firms with medical expertise, excluding those within the healthcare and pharmaceutical industries, are significantly higher than those of firms without such expertise. The positive impact is more pronounced when the CEO or Chairman has medical expertise and when the firm is not state-owned. Overall, this study underscores the importance of diversified executive human capital on firm performance by disentangling the effects of macroeconomic shocks. (JEL G12, G32, J24)