Research has shown that CEO media coverage has important implications for organizational outcomes. Such influence is theorized to unfold mainly via two mechanisms—i.e., the effects that CEO media coverage has on i) CEOs’ and ii) stakeholders’ cognition and behavior. While research in the area has focused on investigating the effects of CEO media coverage on CEO cognition (e.g., overconfidence) and behavior (e.g., risk-taking and overcommitment), relatively less attention has been given to how media coverage of a CEO affects other members of the top management team (TMT). We address this issue and examine how the media coverage of a CEO affects the social interaction between the CEO and the CFO in a firm. Specifically, we focus on CFO mimicry of CEO—i.e., CFOs’ nonconscious adoption of their CEOs’ behavior during social interactions—and theorize that the valence of CEO media coverage affects CFO mimicry of CEO via the CFO’s motivation to affiliate with and willingness to model the CEO. Specifically, we hypothesize that the positive valence of CEO media coverage increases CFO mimicry of CEO whereas the negative valence suppresses it. Drawing on theories of positive-negative asymmetry in evaluations, we theorize that the negative effect is greater than the positive effect. In addition, as more coverage elicits more attention, we expect that the volume of CEO media coverage strengthens both effects. We test our theory in the context of S&P 500 firms’ earnings calls with a sample of 3734 CEO-quarter observations. This study contributes to media coverage literature by explicating how CEO media coverage affects stakeholders’ cognition and behavior and to upper echelons theory by investigating an external source of TMT homogeneity.
