Impacting Business: Why beauty is not a shortcut to executive success

Not necessarily so, according to new research, which indicates that a person’s facial appearance has a significant influence on the result of corporate director elections.

Our research suggests that directors are still judged on their looks; not on their physical beauty but on their perceived competence, trustworthiness, likeability and intelligence.

The results of this study could encourage companies to disclose more information about directors before elections, as well as encourage regulators to consider whether the process for electing and re-electing directors needs to be reviewed. The study also provides food for thought for executives who are trying to get a job on a company board.

The research team reviewed data on 621 separate corporate director elections and re-elections in UK firms between 1996 and 2007. In all these elections, potential corporate directors provided a photograph of themselves to accompany their name and professional details in the election process.

The photographs were then given to anonymous individuals who were asked to rate the directors on various characteristics using only their photograph.

Individuals were asked to provide a numerical score between one and five for five separate character traits of the director: beauty or physical appearance, competence, trustworthiness, likeability and intelligence – which they had to infer from only one photograph.

The findings revealed that while beauty had no impact on voting patterns, the perceived competence, intelligence, likeability and trustworthiness inferred by a corporate director’s facial appearance had a direct influence on voters’ decision-making. Directors who ranked highly for these perceived character traits received more votes in their favour.

Dr Yang Zhao of Newcastle University Business School said: “In principle, people should vote for a director on the basis of their track record in the industry. In reality, though, the facial appearance of a director can be a major influence on whether he or she is voted in.

“This tells us that shareholders are not entirely rational when making their choices. Perhaps companies need to make more information available about potential directors so that voters can make more informed decisions. Companies need to be aware that it’s not just about past performance, it’s more to do with how directors carry themselves and the image they project to the public.

“The judgements that voters make about a director are not really based on the physical attractiveness of that person; they’re based more on whether he or she is deemed competent, intelligent, likeable and trustworthy.”

The findings showed that facial appearance was more important to voters in director re-elections than in first appointment elections, which may reflect their unfamiliarity with the looks of directors in the latter scenario.

Interestingly, the study showed that while men were judged heavily on their facial appearance, women were not. Female candidates’ beauty or other perceived character traits based on facial appearance had absolutely no effect on the number of votes that they received.

Dr Zhao said: “This conclusion dispels the myth that attractiveness improves a person’s chances of success in director elections. In fact, we found that women receive very little voting dissent at all; perhaps this is because many companies and shareholders recognise the benefits of gender diversity at board level and therefore employ a larger number of women in high-powered roles. Our research shows that beauty does not provide a shortcut to success in the business world. That’s an important consideration for ambitious executives who are looking to move into a senior role.

“It is also food for thought for companies; what information should they disclose to shareholders before director elections? Perhaps there’s a case for holding ‘blind’ elections, where voters don’t get to see the faces of directors before they cast their vote. However, this might prove difficult in the age of social media, where information on people is readily accessible.”

The study found that shareholders who owned small equity stakes were more likely to rely on inferences from facial appearance than those holding large equity blocks.

“Perhaps this is because major shareholders conduct more research on directors’ past performance and background,” Dr Zhao said. “It’s difficult to imagine a situation where small shareholder votes are deemed less important than large shareholder votes but maybe regulators need to review the process for electing directors. Perhaps they could tweak some of the rules to make the process fairer?

“The study provides a useful foundation for further research that could link the results of director elections with performance. Did the directors who were voted in based on the perceived characteristics actually do well in their role? That would help us to determine how good humans are at judging the suitability of a director for that role.'

In principle, people should vote for a director on the basis of their track record in the industry. In reality, though, the facial appearance of a director can be a major influence on whether he or she is voted in.

Dr Yang Zhao