Can military executives overcome difficulties in corporate value creation? --Evidence from China

We examine whether military executives have the capacity to handle tough circumstances at a time of COVID-19 pandemic. We find that, firms led by military executives experience less likelihood of financial distress and higher firm value during COVID-19 pandemic. The results are robust to alternative measures of main variables and samples, and to ruling out alternative explanations. This effect is more pronounced for firms with top executives that have longer tenure and higher percentage of ownership, and higher percentage of military executives on top management teams. Further, we also find that executives with military experience improve firm value by adopting proactive strategies, such as diversifying by business segment, strengthening online business and improving cost-efficiency. Our finding suggests the important role of executives' personal traits in leading firms overcome adversity in downturns.