The Impact of CEO Facial Expressions on Firm Performance

In a company's financial reporting, the chief executive officer's (CEO) facial expressions can positively or negatively affect company performance. CEO facial expressions are a form of nonverbal communication that can convey a wealth of information, including emotions such as confidence, concentration, joy, anxiety, stress, and worry. With the development of emotional intelligence and leadership research, more and more scholars have begun to focus on the relationship between leaders' facial expressions and company performance. It is of importance and significance to study the impact of CEO facial expressions on firm performance. Although some preliminary studies are exploring the relationship between leaders' facial expressions and firm performance, there are still many gaps in this area. This paper uses Face Reader and AFEA Facial Expression Automated Analysis System to propose a set of quantitative data on the relationship between the CEO's facial expression and the queried data on the company's net profit interact with each other to verify that the CEO's facial expression when he/she is speaking in the company's financial report has an important impact on the company's performance over the next period. Finally, this paper reveals the mechanism of the impact of leaders' emotional expressions on firm performance, providing practical suggestions and guidance for business management. In addition, the findings can provide new ideas and directions for future leadership research.