Through the Eyes of the Founder: CEO Characteristics and Firms' Regulatory Filings

We examine whether textual attributes of firms’ regulatory filings reflect CEO characteristics and whether investors consider this relation when assessing firm value. We build on prior research that shows founders have unique personality attributes, particularly overoptimism. We find that 10-K text for founder-led firms is characterized by “excess” optimism relative to current and future realized earnings and relative to non-founder-led firms....