Can military executives improve corporate performance? Evidence from industrial competitive pressure*

We examine whether top executives with military experience improve corporate performance compared with nonmilitary executives. We find that firms with military executives have better sales growth, cost efficiency and operating performance than do firms with nonmilitary executives but mainly in highly competitive industries. The results are robust to adopting the PSM method and confronting changes in the competitive condition. Furthermore, we find that military executives influence corporate performance through the pressure resistance and organizational culture channels. In addition, executives with military experience are associated with fewer product recall and workplace safety cases and implement better quality and safety management than do nonmilitary executives. The relation is also strongest for highly competitive industries-even with financial constraints-indicating that military executives do not profit at the expense of product quality and workplace safety. Our findings suggest that military experience as a determinant of managerial traits constantly impacts decision-making and corporate performance.