Finance db | Business & Finance homework help
Furthermore, how effectively executives are able to communicate their vision for the company’s future can heavily influence investor confidence which often directly relates to stock values. If they are seen as trustworthy and capable then this will likely lead to more investors wanting a piece of the action and so demand goes up driving share prices higher. On the other hand if executives do not seem well-equipped or unable to provide clear direction then investors may become apprehensive leading them to offload their shares resulting in reduced demand and thus lower stock values.
Ultimately stock prices are largely dependent upon how well companies perform financially however leadership style also plays an important role since it helps set the tone for what sort of organizational culture exists within corporations. As such it is essential that leaders take into account both their own behavior along with external economic factors when making decisions related to the operations of their organizations so as not minimize any potential distortions in market values caused by missteps from either themselves or other members of upper management teams.