Chief Executive Officer Narcissism Research Articles

Narcissism at the CEO–TMT Interface: Measuring Executive Narcissism and Testing Its Effects on TMT Composition

Extant strategic leadership literature has established the substantial and nuanced implications of narcissism in chief executive officers (CEOs) for firm outcomes, and psychological research on narcissism in groups highlights the importance of narcissism for interpersonal dynamics. However, there is little research on strategic leaders’ narcissism and the CEO–top management team (TMT) interface, especially related to its configuration by way of TMT composition. In this article, we therefore study two issues. First, we examine how CEO narcissism directly affects two aspects of TMT composition—the narcissism of newly appointed TMT members and TMT turnover. Second, we consider the moderating effect of TMT narcissism on the relationship between CEO narcissism and TMT turnover. To be able to test our theory, we develop and extensively validate a novel measure based on LinkedIn profiles that allows us to capture the narcissism of non-CEO executives. We find substantial support for our predictions in a large sample of executives of S&P 1500 corporations across a 5-year time frame. We discuss the contributions and implications of our findings for the literatures on executive narcissism, TMT composition, and the CEO–TMT interface.

Can heterogeneous media attention invigorate green technological innovation: A moderating role of chief executive officer narcissism

AbstractThe current study contemplates the mechanism of heterogeneous media attention affecting green technological innovation (GTI) amid moderation of chief executive officer (CEO) narcissism. Based on the accumulated data of 1545 listed Chinese firms over the period from 2014 to 2018, we have demonstrated that media attention imposes a significant positive effect on GTI; the negative coverage is greater than positive media coverage in effecting GTI whereas CEO narcissism positively moderates the effect of media attention on GTI. The results also show the regional media coverage is greater than national media coverage in effecting GTI, while the CEO narcissism more strongly moderates the effect of negative coverage on GTI and the effect of regional media coverage on GTI. This study provides new insights into the existing literature by deconstructing media attention and enriches the studies in the context of media attention‐GTI relationship from a point of view of the particular personality trait of a CEO.

The impact of CEO narcissism and optimism on capital structure under pandemic conditions

PurposeThe purpose of our study is to study the impact of chief executive officer (CEO) optimism and narcissism on the company's capital structure.Design/methodology/approach(1) The authors opt for regression, machine learning and text analysis to explore the impact of narcissism and optimism on the capital structure. (2) We analyze CEO interviews and employ three methods to evaluate narcissism: the dictionary proposed by Anglin, which enabled us to assess the following components: authority, superiority, vanity and exhibitionism; count of first-person singular and plural pronouns and count of CEO photos displayed. Following this approach, we were able to make a more thorough assessment of corporate narcissism. (3) Latent Dirichlet allocation (LDA) technique helped to find the differences in the corporate rhetoric of narcissistic and non-narcissistic CEOs and to find differences between the topics of interviews and letters provided by narcissistic and non-narcissistic CEOs.FindingsOur research demonstrates that narcissism has a slight and nonlinear impact on capital structure. However, our findings suggest that there is an impact of pessimism and uncertainty under pandemic conditions when managers predicted doom and completely changed their strategies. We applied various approaches to estimate the gender distribution of CEOs and found that the median values of optimism and narcissism do not depend on sex. Using LDA, we examined the content and key topics of CEO interviews, defined as positive and negative. There are some differences in the topics: narcissistic CEOs are more likely to speak about long-term goals, projects and problems; they often talk about their brand and business processes.Originality/valueFirst, we examine the COVID-19 pandemic period and evaluate how CEO optimism and pessimism affect their financial decisions under specific external conditions. The pandemic forced companies to shift the way they worked: either to switch to the remote work model or to interrupt operations; to lose or, on the contrary, attract clients. In addition, during this period, corporate management can have a different outlook on their company’s financial performance and goals. The LDA technique helped to find the differences in the corporate rhetoric of narcissistic and non-narcissistic CEOs. Second, we use three methods to evaluate narcissism. Third, the research is based on a set of advanced methods: machine learning techniques (random forest to reveal a nonlinear impact of CEO optimism and narcissism on capital structure).

Corporate social responsibility and green supply chain efficiency: conditioning effects based on CEO narcissism

Accelerating the construction of the green supply chain system and improving the efficiency of the green supply chain is the key to promoting the high-quality development of enterprises. In view of this, based on stakeholder theory, higher order theory and expectancy theory, this study focuses on the impact of corporate social responsibility (CSR) on corporate green supply chain efficiency (GSCE) and the moderating role of chief executive officer (CEO) narcissism. A regression analysis of the observed sample reveals that CSR significantly enhances GSCE. Further decomposing CSR into internal CSR and external CSR to reveal the impact of different types of CSR on GSCE, we find that internal CSR fulfillment has a significant positive impact on GSCE, and this relationship is strengthened when CEOs are narcissistic. Furthermore, external CSR has a significant negative impact on GSCE, and this relationship is also strengthened by CEO narcissism. The main contribution of this paper is to study the relationship between CSR and green supply chain efficiency, decompose CSR into internal and external CSR, enrich the research on the intrinsic mechanism of value creation of CSR. It also enriches the research in the context of CSR from the perspective of CEO personality traits, providing new ideas and suggestions for manager selection and corporate greening governance in practice.

CEO narcissism and asymmetric cost behavior

This research investigates the relationship between chief executive officer (CEO) narcissism and asymmetric cost behavior. Based on the expectation that CEOs’ narcissism leads to myopic management, I replicate the existence of cost stickiness in a large sample of U.S. public firms and find that narcissistic CEOs exhibit a lower degree of cost stickiness. Additionally, I find that the negative effect of CEO narcissism on cost stickiness is boosted under poor past performance and when firm uncertainty is high. Several robustness tests, including alternative measurements of costs and narcissism, confirm the validity of the results. The findings of this study contribute to the current discussion about the role of narcissistic personalities of CEOs and the behavioral aspects of corporate decisions.

Influence of Narcissistic CEOs on Corporate Social Responsibility (CSR) Choices: The Moderating Role of the Legal Environment.

During recent years, there has been a growing interest in CSR across disciplines. Various scholars document that Chief Executive Officer (CEO) narcissism is an important factor that should not be overlooked when analyzing CSR. Research on the relationship between CEO narcissism and CSR has treated CSR as a whole construct. However, little attention has been paid to its effect on different dimensions of CSR, especially the same psychological trait may have effects on charitable donations and employee welfare. The purpose of the study is to explore the relationship between CEO narcissism and charitable donations and employee welfare, while taking into account the moderating role of the legal environment. This study used the video survey method to measure CEO narcissism, the video information was obtained from Baidu.com and hao.360.com search engines. Other data were collected from Chinese Stock Market Research (CSMAR) database. We used OLS regression for data analysis and also used Tobit regression model to check the robustness of the estimation results. Meanwhile, all analyses will be performed with Stata 16.0 software. Empirical analysis reveals that CEO narcissism has a positive and significant impact on charitable donations and has a negative and significant impact on employee welfare. Moreover, the legal environment will reduce the effect of CEO narcissism on charitable donations and employee welfare, indicating that a stronger legal environment could attenuate the effect of CEO personality traits, especially narcissism on charity donations and employee welfare. This study contributes to the behavioral finance theory and stakeholder theory to better understand the relationship between CEO narcissism and charitable donations and employee welfare. Meanwhile, this study is one of the few studies to investigate the patterns of CSR activities in China, an important emerging economy.

CEO Narcissism and CEO Overconfidence on Firm Performance: The Role of Capital Structure as Mediating Variable

Chief Executive Officers (CEO) have an important role in a company’s future, including the financial decisions of a company. Therefore, this study investigates the role of capital structure as a variable that mediates the effect of CEO narcissism and CEO overconfidence towards the performance of Indonesian infrastructure companies that are listed on the Indonesia Stock Exchange. This study obtained 39 companies as a study sample from 2017 to 2021 and analyzed them using the multiple linear regression method. This study found that capital structure is negatively affected by CEO narcissism, and positively affected by CEO overconfidence. Capital structure doesn’t affect Return on Asset (ROA) but negatively affects Return on Equity (ROE). CEO narcissism doesn’t affect firm performance as measured by ROA but positively affects ROE. Unlike the CEO overconfidence doesn’t affect either ROA or ROE. Moreover, the capital structure can mediate the impact of CEO narcissism and overconfidence on ROE, but it cannot mediate the impact on ROA. The results of this study contribute to academics as well as corporate knowledge as research regarding CEO narcissism and CEO overconfidence is uncommon and can be useful as a reference for companies.

CEO narcissism and corporate performance in China

This study explores the relationship between chief executive officer (CEO) narcissism and corporate performance in China. Based on the Chinese institutional and cultural background, we introduce organizational innovation as a mediating variable and CEO power as a moderating variable. We find that CEO narcissism is positively related to corporate performance based on 275 companies listed on the growth enterprise market (GEM) from 2012 to 2020. Furthermore, organizational innovation plays a partially mediating role in the relationship between CEO narcissism and corporate performance, and the moderating role of CEO power is partially supported.

The impact of chief executive officer narcissism on environmental, social, and governance reporting

AbstractWe analyze the effect of chief executive officer (CEO) narcissism on environmental, social, and governance (ESG) reporting. The study relies partly on hand‐collected, visual data and covers 57 German DAX 40 and MDAX companies from 2016 to 2020 (266 company‐year observations, Bloomberg database). Looking into the sub‐scores of ESG, CEO narcissism has a negative and linear relationship with environment and governance reporting but there is no significant relationship between narcissism and social reporting. Regression analyses further suggest a U‐shaped (quadratic) relation between CEO narcissism and ESG reporting: while low to moderate degrees of narcissism affect overall ESG reporting negatively, as CEO levels of narcissism increase so does the level of reporting. Moreover, further analysis has shown that the quantity of reporting is additionally positively related to ESG performance. The study applies and validates a relatively new but easily applicable measure of narcissism and extends narcissism research in the area of curvilinear relationships. We offer several further implications for human resource managers, regulators, auditors, and (non‐)financial analysts.

Examining Chief Executive Officer’s Narcissistic and Humility Rhetoric

Chief Executive Officer (CEO) narcissism has received considerable attention across academia and practitioner-orientated outlets. While the voluminous research stream of CEO narcissism is mostly linked to a dark personality trait, research indicates that humility has the potential to counterbalance the detrimental effects of CEO narcissism. Given the important individual and firm-level outcomes of both constructs, a systematic assessment of how rhetorical elements (i.e., language reflective of a construct) in CEO speech is still missing. We exploit conceptualizations of both constructs as “polar opposites” to derive the dimensions of both constructs and to distinguish them analytically. We further argue that subtle yet observable rhetorical cues reveal important aspects of CEOs' personality inclinations. Our results, based on qualitative documents from publicly available CEO speeches, suggest that CEOs differ in using narcissistic and humility rhetoric. This holds true even if we change the coding scheme (i.e., assessing alleged narcissistic CEOs with humble rhetoric and vice versa). Although alleged humble CEOs use narcissistic rhetoric, indicating a general trend towards confidence-inducing vocabulary and CEO speech, alleged narcissistic CEOs employ more than twice as much narcissistic rhetoric than alleged humble CEOs. Alleged narcissistic CEOs use a third of humility rhetoric as alleged humble CEOs do. Therefore, we conclude that these differences are more likely to stem from CEO personality inclinations. We discuss the value of these unobtrusive measures and warning signs in theory and practice.

The double‐edged sword of CEO narcissism: A meta‐analysis of innovation and firm performance implications

AbstractDespite a growing body of research, the role of chief executive officer (CEO) narcissism for firm performance is subject to a controversial discussion in the literature. To help advance the discussion, I build on upper echelon theory to propose that innovation is a crucial mediating mechanism that helps explain how CEO narcissism may be beneficial for firm performance. To better understand the conditions under which CEO narcissism may be beneficial for innovation and ultimately firm performance, I investigate the moderating role of CEO gender and managerial discretion. Building on 68 studies, results from meta‐analytical structural equation modeling confirm that CEO narcissism can be beneficial for firm performance through stimulating innovation. However, the results further caution that these performance benefits are likely to be canceled out by other detrimental actions pursued by narcissistic CEOs, indicating that they can be a double‐edged sword for firms. Moreover, the results support that narcissistic female CEOs engage less in innovation (compared to their male counterparts). Interestingly, they seem to engage in other beneficial actions which ultimately improve overall firm performance, whereas their male counterparts engage in other harmful actions which hurt overall firm performance. The results further highlight that, while the upsides of narcissistic CEOs for performance through innovation increase in high managerial discretion contexts, their greater leeway enhances their downsides even more, so that they do not only offset the benefits of narcissistic CEOs, but even lead to detrimental effects for performance. This study contributes to the literature on CEO narcissism by theorizing and empirically demonstrating that the relationship between CEO narcissism and performance is more complex than previously depicted and requires a more nuanced investigation of the underlying mechanism as well as of potential contingencies. Building on these findings, future research opportunities are identified to further advance the literature on CEO narcissism.

Narcissistic CEOs' dilemma: The trade‐off between exploration and exploitation and the moderating role of performance feedback

AbstractPrior research has established a positive link between chief executive officer (CEO) narcissism and firm innovation. Notably, research shows that CEO narcissism is positively related to more radical innovation and breakthrough technologies, that is, manifestations of a firm's exploration orientation, and positively related to more incremental innovation, that is, manifestations of firms' exploitation orientations. However, it primarily examines these orientations in isolation or neglects their interplay and thereby ignores insights from organizational learning theorists that firms and managers face decisive trade‐offs between fundamentally distinct exploration and exploitation orientations. This overlooks the possibility that narcissistic CEOs may emphasize exploration over exploitation, and vice versa, to gain visibility, affecting the balance between those orientations. Consequently, we might draw incorrect conclusions about how CEO narcissism affects firms' innovation. Drawing on theoretical mechanisms from the narcissistic personality literature, we develop and test a competing logic that connects CEO narcissism with firms' relative exploration orientation, that is, firms' exploration relative to the exploitation orientation. In addition, we theorize on and investigate the moderating effects of accounting‐ and market‐based performance feedback that may alter narcissistic CEOs' attention to exploration or exploitation and, hence, affect the relationship with firms' relative exploration orientation. We test our hypotheses using panel data from 120 firms in the Standard and Poor's 100 index between 2008 and 2018, covering the personality profiles of 224 CEOs. Our findings indicate that CEO narcissism is negatively associated with firms' relative exploration orientation, that is, narcissistic CEOs emphasize an exploitation orientation. Furthermore, this relationship is pronounced with firms' increasing relative accounting‐based performance and attenuated with firms' increasing relative market‐based performance. We draw theoretical and managerial implications from these insights.

Does owner CEO narcissism promote exporting SMEs' market spreading strategy? Joint effects of asset-specific investments and firm exporting experience

This study explores the influence of owner chief executive officer (CEO) narcissism on the market spreading strategy of exporting small-to-medium enterprises (SMEs). Combining insights from the literature on CEO narcissism and trait activation theory, it is argued that SMEs with narcissistic owner CEOs are more likely to prefer a market spreading strategy, depending on firm-level asset-specific investments and exporting experience. The empirical analysis of a sample of 248 exporting SMEs in China supports the theoretical prediction that owner CEO narcissism has a positive impact on the preference toward a market spreading strategy. In addition, the results show that asset-specific investments weaken the positive influence of owner CEO narcissism on the preference of a market spreading strategy, but this negative moderating effect becomes less significant as SMEs gain more exporting experience. This paper contributes to the emerging research on the role of owner CEO narcissism in firm internationalization decisions, offering a more complete understanding of the extent to which owner CEO narcissism can influence exporting SMEs' tendency toward market spreading, and delineating how such influence may be dependent on organizational-level situational factors.

Activism for Whom? The Role of CEO Narcissism on Firm Engagement in Socially Contentious Issues

Research has extensively documented how executives’ personality traits, experience, and personal values shape firm behaviors and outcomes. Narcissism in Chief Executive Officers (CEOs) has been convincingly associated with pursuing risky market strategies but has not been explored in regard to influencing a firm’s nonmarket strategies. We investigate narcissistic CEOs’ involvement with contentious sociopolitical issues (SPIs) to understand whether they also engage in risky nonmarket actions. Drawing from the wider constructs on narcissism in personality psychology research, we argue narcissistic CEOs steer firms toward risky nonmarket actions due to: insensitivity to risks, search for attention, and the need to expose socially desirable identities. Testing for interactions with celebrity status and the degree of national public opposition to the SPI also reflect the likelihood that such involvement is driven strongly by selfish motives. We tested our theoretical model examining firms’ support to the same-sex marriage from 2004-2015 with a random sample of 209 S&P 500 firms. We found support for our model showing that narcissistic CEOs were more likely to engage in SPI, and both low celebrity status and high degree of public opposition strengthen this involvement.

CEO narcissism, brand acquisition and disposal, and stock returns

Chief executive officer (CEO) narcissism is an ingrained personality trait referring to the degree to which an individual CEO has an inflated level of self-admiration and seeks to gain attention and social praise by pursuing vanity-driven strategic objectives. We find evidence that narcissistic CEOs are less likely to dispose of brands but more likely to acquire brands than their less narcissistic counterparts. Further, narcissistic CEOs are more likely than their counterparts to lead their companies to acquire high-awareness brands and more likely to dispose of low-awareness brands. We also propose a moderated mediation model in which CEO narcissism increases target brand asset overvaluation, and through this mediator, CEO narcissism has a negative indirect impact on the acquirer’s abnormal returns but a positive indirect impact on the seller’s abnormal returns associated with the brand transactions. Brand awareness and perceived quality weaken the relationship between target brand asset overvaluation and abnormal returns.

Explorative and exploitative innovation: A perspective on CEO humility, narcissism, and market dynamism

Organizational innovation is characterized by exploration and exploitation. A firm can benefit from the qualities of its chief executive officer (CEO) if it understands to what extent those qualities are related to the organizational innovation. For context, Chinese culture embraces the belief of unity of opposites. Accordingly, CEO humility and CEO narcissism are not absolute opposites but are in fact complementary; therefore, they can coexist. Based on a sample of 239 manufacturing firms in China, we find that CEO humility promotes both exploitative and explorative innovation, while CEO narcissism weakens exploitative innovation. Additionally, the interaction between the two traits of the CEO strengthens both exploitative and explorative innovation. Contingency analysis further reveals that high-level market dynamism strengthens the positive interaction effect between CEO humility and CEO narcissism on both exploitative and explorative innovation. These findings contribute to the research on exploitative and explorative innovation.

The effects of CEO narcissism on corporate social responsibility and irresponsibility

This study examines how chief executive officer (CEO) narcissism influences a firm's activities associated with corporate social responsibility or irresponsibility (CSR or CSIR, respectively). Employing upper echelons theory, the approach–avoidance motivation of narcissists, and the overinvestment hypothesis, we predict that CEO narcissism positively affects both CSR and CSIR. We also propose that these relationships are negatively moderated by corporate governance structure, captured by the ratio of outside directors and the ownership of institutional investors. Empirical results from a panel dataset of U.S. firms for the 2000–2012 period provide support for our hypotheses. Our finding establishes a better theoretical and practical understanding of how a CEO's psychological personality can change a firm's behavior with respect to its social responsibility.

Impact of CEO narcissism and hubris on corporate sustainability and firm performance

To explore the personality traits and corporate strategy of chief executive officers (CEOs), this study investigates how narcissistic and hubristic tendencies in CEOs affect the relationship between corporate sustainability practices (CSP) and firm performance. The primary purpose is to examine whether CEO narcissism and hubris can moderate the effect of corporate sustainability on firm performance. We investigate the influence of corporate sustainability on firm performance in three dimensions: economic, environmental, and social. The relationship between the mechanisms of supervision and agency theory is explored to assist investors in decision making. The results of this study show that compared to narcissistic CEOs, hubristic CEOs will further enhance the positive influence of CSP on corporate performance, especially in the environmental and social dimensions. This research strengthens the literature on CEO narcissism and hubris by demonstrating that CEO personality traits influence the relationship between corporate sustainability practices and firm performance.

Moderating Effect of Chief Executive Officer Narcissism in the Relationship Between Corporate Social Responsibility and Green Technology Innovation.

This study focuses on the impact of corporate social responsibility (CSR) on green technology innovation (GTI) of firms and the moderating influence of the chief executive officer (CEO) narcissism through the lens of stakeholder theory and upper echelons theory. This research deconstructs CSR into internal CSR and external CSR in order to reveal the effects of different types of CSR on GTI. Based on a sample of 1,745 firm-year observations from 349 Chinese-listed firms across sectors between 2014 and 2018, we find that the fulfillment of internal CSR has a significant positive impact on GTI. This relationship is strengthened when the CEOs are narcissistic. The external CSR has a significant negative impact on GTI and this relationship is strengthened by CEO narcissism. The major contribution of our study is that it provides a theoretical contribution to the existing literature by deconstructing CSR into internal and external CSRs and enriches the studies in the context of CSR from a point of view of the particular personality trait of a CEO.

Chief Executive Officer (CEO) Narcissism and Risk of Financial Reporting Fraud with Placing Emphasis on the Roles of Auditors and Audit Committees

Objectives: In neoclassic economy, it is assumed that decision-makers behave intellectually and always pursue the maximization of their own favorability, but results of several investigations show that in order to find answers to financial questions, we have to accept this probability that behaviors of decision-makers may not be perfectly intellectual. In other words, personality traits of managers are considered factors being important in making decisions. One of such traits is narcissism. Narcissistic personality is associated with signs or indications of sense of superiority, preoccupation with success vagary, power, aesthetic talents, and belief in being an exceptional and unique person. Narcissistic managers are basically willing to achieve great accomplishments within organisations they take over. They tend to do strategically adventuresome operational activities and risky ventures so that decisions made by them can lead to high amounts of profit/ loss at the end of fiscal periods.Present research was done to examine effects of CEO narcissism on the risk of fraud in financial reporting and the moderating roles the auditors and audit committees play regarding the relationship between CEO narcissism and risk of fraud in financial reporting. On this basis, narcissistic managers seeking to reach the best performance are most likely to perform fraudulent activities because measurement of financial performance, which is considered as reflection of decisions made by managers, is a mechanism for managers to be visible and praised. This can be one of factors manifesting narcissism among managers in order to recognize their honor and magnificence. Method: In order to study the subject, data on 90 companies listed on Tehran Stock Exchange during 2014-2018 was collected by Rah Avard Novin software from financial statements, attached notes and official site of Tehran Stock Exchange to be used to test research hypotheses based on logistic regressions. Findings: Findings of present research showed a significantly positive relationship between CEO narcissism and risk of fraud in financial reporting. Findings also signified some moderating effect for efforts made by auditors and for proficiency of auditors and of audit committees' chairmen on the relationship between CEO narcissism and risk of fraud in financial reporting. Results: As a CEO's personality trait, narcissism may increase likelihood of the risk of fraud in financial reporting. As a part of corporate governance mechanisms, recruitment of diligent and Expert auditors as well as audit committees specialized in finance and accounting can be an obstacle to the fraudulent financial reporting caused by CEO narcissism.