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Do young CEOs matter for corporate digital transformation?

Author

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  • Zou, Ziran
  • Fu, Jiayi
  • Zeng, Yeqin
  • Huang, Yuxuan

Abstract

This paper investigates the empirical relation between CEO age and corporate digital transformation. Using a sample of Chinese listed firms between 2007 and 2022, we find that younger CEOs exhibit a higher propensity to engage in digital transformation when compared to older counterparts. We pinpoint two key driving factors behind this phenomenon: CEOs’ motivation to establish a good reputation and their willingness to embrace failure. Furthermore, our heterogeneity tests show that the negative relation between CEO age and digital transformation does not vary with firms’ state ownership, but is more pronounced among firms with fewer financial constraints. Overall, our finding contributes to the growing body of literature examining the role of managerial traits in corporate digital transformation.

Suggested Citation

  • Zou, Ziran & Fu, Jiayi & Zeng, Yeqin & Huang, Yuxuan, 2024. "Do young CEOs matter for corporate digital transformation?," Economics Letters, Elsevier, vol. 237(C).
    • Handle: RePEc:eee:ecolet:v:237:y:2024:i:c:s0165176524001198
    DOI: 10.1016/j.econlet.2024.111636
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    More about this item

    Keywords

    CEO age; Corporate digital transformation; CEO reputation; Tolerance for failure;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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