Lucrative left-handedness: Gates, Bloomberg and Zuckerberg are all lefties. Is this relative rarity a business advantage?

Like other left-handed CEOs — including Steve Jobs and Henry Ford — they’re known for innovation. Zuckerberg transformed social media, Gates disrupted computing and Bloomberg revolutionized trading with software providing real-time data.

The apparent link between left-handedness and innovation got George Mason University accounting professors Long Chen and June Woo Park thinking. They decided to test whether left-handed CEOs drive greater corporate innovation.

This reflects their ongoing research into characteristics and traits of successful CEOs.

“When you pick a stock, there are a lot of things to look at in addition to a firm’s growth,” Chen said.

She added that understanding things like a CEO’s family background, education and cumulative experience may help investors better understand and anticipate a CEO’s decisions.

Their research on CEO handedness has resulted in two academic papers to date, contributing new insights to behavioral finance and psychology.

“And it was fun, of course,” Chen said, noting that her father and daughter were both born left-handed.

She and Park shared their findings in an interview with Moneywise. They also hinted at the next fun thing they’re studying when it comes to CEOs.

Left-handed leaders may be more innovative

First, they set out to identify left-handed CEOs. They didn’t just search for the phrase ‘left-handed CEOs.’ They studied images and videos of S&P 500 CEOs to deduce handedness.

“Long and I watched a lot of recordings of golf club swings, or which hand they used to eat something,” Park told Moneywise. “It was a lot of work. The data collection was massive.”

If they weren’t sure, they wrote to the CEOs’ firms to confirm handedness. Chen and Park discovered that just 8% of S&P 500 leaders were left-handed (and a mere 0.7% ambidextrous).

But when they cross-referenced handedness with hallmarks of innovation (specifically patents), they discovered that while left-handed CEOs are rare, their companies are consistently more innovative than those led by right-handed peers — receiving 10% more patents than the sample average.

Studying U.S. patent inventor data in the Harvard Dataverse, they discovered that southpaw CEOs were not only likelier to be inventors themselves, but also more innovative in who they hired.

Left-handed CEOs’ firms employed more H-1B and STEM visa workers, who in turn contributed to company innovation by introducing novel ideas.

As a further indication of innovation, Chen and Park noticed that firms with left-handed leaders had more truly groundbreaking patents — with fewer references to existing inventions — than their competitors’ patents.

These trends were particularly notable when a left-handed CEO took over from a right-handed CEO.

The resulting study made headlines worldwide. Park followed up with another deep dive into CEO handedness — this time examining communication skills.

Southpaw CEOs could be better communicators

He set out to determine whether southpaw CEOs are better communicators than their right-handed peers.

Specifically, he and his colleagues looked at the management discussion and analysis (MD&A) sections of U.S. S&P 500 annual reports, something that a lot of investors rely on for decisions. The researchers compared the relative readability of MD&As at firms with left-handed leaders.

Sure enough, they found that left-handed CEOs’ firms produce more readable MD&As (and earnings disclosures) than those led by right-handed peers.