Is there basic criteria for assessing management capability for listed companies?

Hey Guohao!

I fully agree with you that management plays a pivotal role in the success of the company. And attributes of the management are not quantitiative, it's qualitative. So we need to know how to identify these qualities out!

For me, this is the minimal checklist that I adhere to for management:

1) Skin in the game. Are they vested in their business themselves?

2) Hired hand vs. "home-grown" CEO. To me, a home-grown CEO knows the business inside out, and his priority is not the share price, but the growth of the business.

3) Candor in annual reports. Candor means the quality of being open and honest; frankness. (quote from Google). Somehow or somewhat, you can sense the honesty of a CEO through the things they say/words they write. It's amazing. On the opposite end, we also have CEO who just goes around the bush talking about general ideas, but never answering any questions properly (Fun fact, take a look if your company's CEO does the same haha)

Hope it helps!

Very simply, in 3 broad categories.

1) Quantitative (the numbers) Resources you can use: https://www.youtube.com/watch?v=KfDB9e_cO4k

2) Qulitative (Management and business model and competitors)

3) Valuation

I like companies with lots of ownership and they have been executing on what they say. Basically, walking the talk. Some of my friends interview management too, to get a sense of their personality.

Hi Guohao,

Length of Tenure could be an indicator - how long the CEO and top management has been serving the company.

Another indicator could be share buyback and to how long the management holds shares.

Unfortunately, there is no single template for evaluating a company's management, but it might give you some ideas when you analyse a company in future.