article thumbnail

Research: CEOs with Diverse Networks Create Higher Firm Value

Harvard Business Review

For example, firms with better-connected CEOs can obtain cheaper financing , and firms with well-connected board directors see better performance. Our study , published in the Journal of Corporate Finance, found that CEOs with strong connections to people of different demographic backgrounds and skill sets create higher firm value.

article thumbnail

Stop Focusing on Profitability and Go for Growth

Harvard Business Review

So, in real terms, debt financing is essentially free. And the average long-term ROE is more than 25%, reflecting improved efficiency combined with greater reliance on financial leverage at most companies. And, finally, they must build the skills and capabilities required to capitalize on their most promising experiments.

ROE 14