Study Links CEOs' Varied Careers to Greater Financing-Investment Maturity Gaps

A new paper examining China’s A-share listed corporations reveals that chief executives with diverse professional histories intensify mismatches between the timing of financing and investment activities. The authors demonstrate that the more complex a CEO’s career portfolio, the larger the maturity gap, a result that persists after applying propensity score matching, instrumental variable, and difference-in-differences methods.

Mechanism analysis points to increased financing constraints as the conduit for this effect. The phenomenon is pronounced in non-state-owned enterprises, firms with relatively weak equity incentive structures, and firms whose leaders do not possess a finance background. These findings broaden the theoretical link between managerial traits and corporate financial decisions and offer practical guidance for executive hiring practices.