Chief Executive Officer Narcissism Research Articles

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.

CEO narcissism, top management team transactive memory systems, and firm performance: an upper echelons perspective on CEO admiration and rivalry narcissism

ABSTRACT A growing body of conceptual and empirical research has drawn on transactive memory systems (TMS) theory to understand the functioning of a wide range of teams, including top management teams (TMTs). At the same time, there has been increasing interest in how personality factors, and in particular chief executive officer (CEO) narcissism, shape corporate decision-making, and behaviour in TMTs. However, these streams of research have developed independently from one another. Leveraging a sample of 64 firms, we integrate TMS theory and upper echelons theory to explain how the performance consequences of TMTs are shaped by two competing dimensions of CEO narcissism: admiration-based narcissism and rivalry-based narcissism. CEO narcissism is an important area of research because of the strategic implications of the impact that this personality trait can have on the functioning of the TMT. We find that TMT TMS has a positive influence on firm performance at higher levels of admiration-based narcissism, but not rivalry-based narcissism. With this focus, we provide further substantiation of the firm-performance implications of TMS, and the critical role played by a dimensional focus on CEO narcissism in the TMS context.

CEO narcissism and corporate tax avoidance,

ABSTRACT Narcissism (NARC) in senior executives has a perceptible impact on corporate decision-making and strategies and is often associated with unethical and opportunistic behaviors, including tax avoidance (TA). In this study, we therefore evaluated the association between chief executive officer (CEO) NARC and TA in Brazilian public firms. By focusing on Brazil, an emerging economy regulated by code law, our investigation makes an important contribution to the accounting literature on TA. Most studies examining the relation between corporate TA and CEO personality profile have been conducted in common law countries. According to the literature, TA behaviors are influenced by tax system specifics. In addition, the home country’s level of economic development should be taken into account when quantifying corporate TA. These observations, and the lack of previous investigation focusing on Brazil, ratify the relevance of the study. Our study also provides tax authorities, auditors, and investors with tools to identify narcissistic behaviors predictive of corporate TA, which may demand precautionary measures on part of business partners. The sample consisted of 68 Brazilian public firms (382 observations), covering the period 2010-2017, and a robust regression model with panel data was used. TA and NARC were measured with secondary data according to the literature. Our findings show a positive correlation between CEO NARC and TA. Executives with this personality trait come across as bold or aggressive, thus more prone to adopt TA strategies, as confirmed in the present study. The study contributes to the literature by demonstrating how a personality disorder like NARC affects corporate tax policies, with potential damage to corporate reputation.

The relationship between CEOs’ narcissism and internal controls weaknesses

PurposeThis study aims to investigate the relationship between chief executive officer (CEO) narcissism and internal control weaknesses in the Iranian listed companies.Design/methodology/approachThe study’s statistical population consists of 1,309 firm-year observations from 2012 to 2018. Multivariate regression and the least squares regression are used in this study to examine the hypothesis.FindingsThe hypothesis confirms a positive and significant relationship between the CEOs’ narcissism and the internal control weaknesses (ICWs). In other words, managers with narcissistic personality traits prioritize their position, interests and goals. Therefore, there is more possibility of information distortion and denying the existing internal controls, leading to an increase in misreporting.Originality/valueIn this paper, two variables, including the manager’s signature and the managers’ cash compensation index, are used to assess the CEO’s narcissism, leading to more accurate results. This is also the first study examining CEO narcissism and internal control weaknesses, especially in the emerging market.

CEO narcissism, CEO duality, TMT agreeableness and firm performance

PurposeThis study aims to investigate the relationship between Chief Executive Officer (CEO) narcissism and firm performance. Further, it examined the moderation effects of CEO duality and top management team (TMT) and board member agreeableness on the CEO narcissism–firm performance relationship.Design/methodology/approachThe study is based on survey data from 373 CEOs in the automobile industry in India. The paper used mixed method research where CEO narcissism and TMT agreeableness has been measured using survey instruments, other data such as firm performance has been captured using secondary sources.FindingsThe study confirms that the relationship between CEO narcissism and firm performance is curvilinear, meaning that narcissism can positively impact firm performance to a point, but may become counter-productive or ineffective beyond that. Further, CEO duality and TMT and board member agreeableness significantly impact this relationship.Originality/valueThis paper fulfills an identified need to study how CEO behavior can affect variance in firm performance. The authors discuss theoretical and practical implications and offer suggestions for future research.

Chief executive officer narcissism and firm value: The mediating role of corporate social responsibility in the South Korean context

AbstractThis study analyzes whether narcissism in chief executive officers (CEOs) affects firm value through the promotion of corporate social responsibility (CSR) initiatives. Employing the upper‐echelons perspective, we present a research framework for the relationship between CEO narcissism and firm performance with CSR as the mediation variable. The results of the regression analysis of 265 firm‐year South Korean samples from 2010 to 2016 indicate that CEO narcissism promotes CSR initiatives and CSR enhances firm value in the capital market. However, the results do not provide evidence that CSR mediates the link between CEO narcissism and desirable organizational outcomes. The findings of this study build a better theoretical and practical understanding of the antecedents and consequences of CSR from the CEO's psychological personality perspective.

Making CEO Narcissism Research Great: A Review and Meta-Analysis of CEO Narcissism

Chief executive officer (CEO) narcissism is an important area of research due to the strategic implications of how this multifaceted personality trait affects CEO behavior. This article presents a combined meta-analytic and narrative review of CEO narcissism and makes future research recommendations. Our review and meta-analytic findings lead to the creation of a framework for CEO narcissism research focused on narcissistic CEO supply, demand, behavior, and consequences. Additionally, our review identifies five methods of measuring CEO narcissism, each with strengths and weaknesses. We find that while extant findings exhibit common themes, such findings remain mixed and potentially dependent upon methods. We recommend that future research expand beyond the strategic consequences of CEO narcissism to consider additional foci of the research framework and its moderators. Additionally, we suggest that research can benefit from moving beyond the predominant theoretical lenses of upper echelons theory and leadership theory to the lenses of the extended agency model of narcissism, the admiration-versus-rivalry perspective of narcissism, and tournament theory.

How CEO narcissism affects corporate social responsibility choice?

This study aims to explore how CEO narcissism affects firms’ CSR choice given that the relationship between chief executive officer (CEO) narcissism and corporate social responsibility (CSR) has yielded inconclusive results. On the basis of upper echelon theory and the attention-based view, we first propose that narcissistic CEOs allocate more attention to peripheral CSR and less attention to embedded CSR. We then explore the boundary conditions that may affect CEO narcissism and CSR choice. We find that CEO narcissism is positively related to peripheral CSR and negatively related to embedded CSR via a sample of 4792 firm-year observations in the manufacturing industry of Chinese A-share listed firms. Results show that family ownership weakens the negative relation between CEO narcissism and embedded CSR. Moreover, CEO duality strengthens the positive relation between CEO narcissism and peripheral CSR and strengthens the negative relation between CEO narcissism and embedded CSR. These findings have significant implications for the CSR literature, narcissism research, and the attention-based view.

CEO Narcissism and Organizational Ambidexterity: Moderating Roles of CEO Power and Firm Reputation

We examine how chief executive officer (CEO) narcissism affects the organizational ambidexterity of the firm. We theorize firms led by more-narcissistic CEOs are less likely to achieve organization...

Riding the Crest of Wave: CEO Narcissism and Corporate Social Responsibility Choice

While the relationship between chief executive officer (CEO) narcissism and corporate social responsibility (CSR) has yielded inconclusive results, this study aims to explore which type of CSR acti...

The Deliberate Engagement of Narcissistic CEOs in Earnings Management

Corroborating upper echelons theory, this study picks up the notion that narcissistic chief executive officers (CEOs) take advantage of accounting choices to enhance their firms’—and inherently their own—personal track records. Using a set of 15 indicators, reflecting the narcissistic trait of 1126 CEOs for the period 1992 to 2012, we find evidence of highly narcissistic CEOs engaging in accrual-based earnings management (ABEM). In contrast to prior research, the results show evidence not only for income-increasing but also for income-decreasing ABEM. This indicates that highly narcissistic CEOs not only strive to influence stakeholders’ perception of current performance. We conclude that they also assess their potential to influence perception of current and future earnings. The results imply that highly narcissistic CEOs’ accounting choices are driven by self-serving behavior rather than by the intention to provide additional information to the market. When earnings management techniques are used to derive personal advantage from the presentation of a firm’s earnings, the literature refers to this as a case of low earnings quality reflecting unethical behavior. Accordingly, this study contributes to the field of business ethics by showing that CEO narcissism is related to low earnings quality in that it is associated to discretionarily decreasing accruals.

Is Narcissism Sustainable in CEO Leadership of State-Owned Enterprises?

The state sector has been an important part of many economies. This study measures the narcissism of the chief executive officers (CEOs) of state-owned enterprises (SOEs) unobtrusively, and examines the effect of narcissism on the performance and accounting earnings management of firms. This study shows that the narcissism of CEOs positively affects the performance of SOEs, and that the positive effect is a result of real management decisions rather than accounting earnings management. It also shows that CEO narcissism does not affect the earnings management of SOEs. However, this relation changes as the tenure of the CEO gets longer. As tenure gets longer, a CEO’s narcissism negatively affects the performance of a SOE, and a CEO with high narcissism is likely to be involved in earnings management to make up for weak performance. This study suggests that narcissism is not a sustainable leadership style. It also suggests that the personal characteristics of executives in public corporations are important in determining the performance of firms. While a longer tenure ensures that a CEO will pursue his/her strategy steadily, the leadership of a narcissistic CEO becomes negative and ineffective as their tenure gets longer. Considering the importance of SOEs in the economy, this is an important policy implication, as the appointment of a CEO and length of tenure are likely to be determined by the government.

Me, myself, and I: influence of CEO narcissism on firms’ innovation strategy and the likelihood of product-harm crises

This research examines the relationship between narcissistic personality characteristics in Chief Executive Officers (CEOs) and firms’ innovation outcomes. The authors argue that firms led by narcissistic CEOs are likely to exhibit a higher rate of new product introductions and a greater proportion of radical innovations in their new product portfolios, but they are also more likely to encounter product-harm crises. The impact of CEO narcissism on these innovation outcomes is partially mediated by firms’ higher competitive aggressiveness. High power of the marketing department in the top management team, however, increases firms’ customer orientation, which in turn weakens the relationship between CEO narcissism and product-harm crises. A longitudinal analysis of a sample of 395 publicly listed U.S. firms in the period 2006–2010 provides considerable support for the authors’ hypotheses. This research underscores the importance of studying CEOs’ personality traits as antecedents of firms’ innovation outcomes, highlights the positive and negative impact of CEO narcissism on firms’ innovation-related behavior, and delineates the process through which this impact takes place.

CEO Narcissism and the Impact of Prior Board Experience on Corporate Strategy

We examine how chief executive officer (CEO) narcissism influences the interorganizational imitation of corporate strategy. We theorize that narcissistic CEOs are influenced more by the corporate strategies they experienced on other boards and less by the corporate strategies experienced by other directors. These effects are strengthened if the other firms to which the CEO has interlock ties have high status and if the CEO is powerful. Through longitudinal analyses of Fortune 500 companies’ decisions (from 1997 to 2006) related to the acquisition emphasis of a firm’s growth strategy and the firm’s level of international diversification, we show that narcissistic CEOs are influenced by corporate strategies that they witnessed at other firms much more than other CEOs. In addition, relatively narcissistic CEOs not only strongly resist the influence of other directors’ prior experience but also tend to demonstrate their superiority by adopting corporate strategies that are the opposite of what fellow directors’ prior experience would suggest. Our theory and results highlight how CEO narcissism limits directors’ influence over corporate strategy and influences CEOs’ learning and information processing in making strategic decisions.

CEO Narcissism, Audience Engagement, and Organizational Adoption of Technological Discontinuities

We examine the responses of major pharmaceutical firms to the advent of biotechnology over the period 1980 to 2008 to explain why established firms vary in their adoption of technological discontinuities. Combining insights from upper echelons theory, personality theory, and research on organizational responses to new technologies, we posit that narcissistic chief executive officers (CEOs) of established firms will be relatively aggressive in their adoption of technological discontinuities. We propose, however, that the effect of a CEO’s narcissism on organizational outcomes will be moderated by audience engagement—the degree to which observers view a phenomenon as noteworthy and provocative—which varies over time. When audience engagement is high, narcissistic CEOs will anticipate widespread admiration for their bold actions and thus will invest especially aggressively in a discontinuous technology. Drawing from work on managerial cognition, we further hypothesize that CEOs’ narcissism will influence their top managers’ attention to a discontinuous technology, an association that will also be moderated by audience engagement. Finally, we suggest that managerial attention to the discontinuous technology will subsequently be reflected in company investments in the new technological domain. Results provide considerable support for our hypotheses and highlight the role of narcissism in the context of radical organizational change, the influence of audience engagement on executive behavior, and the effect of executive personality on managerial attention.

CEO Servant Leadership: Exploring Executive Characteristics and Firm Performance

This study offers an examination of the relationships between chief executive officer (CEO) servant leadership, the executive characteristics of narcissism, founder status, and organizational identification, and firm performance in a sample of 126 CEOs in technology organizations. Analysis of data gathered over multiple periods revealed a negative relationship between CEO narcissism and servant leadership, and a positive relationship between founder status (i.e., founder or nonfounder) and servant leadership. Furthermore, CEO organizational identification served as a partial mediating mechanism linking narcissism and founder status to servant leadership. In turn, CEO servant leadership predicted subsequent firm performance (measured as return on assets). The results of this study have implications for researchers interested in better understanding the predictors and consequences of servant leadership and for practitioners concerned with combating negative or selfish executive leadership behaviors and employing servant leadership for the organization's benefit.

It's All about Me: Narcissistic Chief Executive Officers and Their Effects on Company Strategy and Performance

This study uses unobtrusive measures of the narcissism of chief executive officers (CEOs)—the prominence of the CEO's photograph in annual reports, the CEO's prominence in press releases, the CEO's use of first-person singular pronouns in interviews, and compensation relative to the second-highest-paid firm executive—to examine the effect of CEO narcissism on a firm's strategy and performance. Results of an empirical study of 111 CEOs in the computer hardware and software industries in 1992–2004 show that narcissism in CEOs is positively related to strategic dynamism and grandiosity, as well as the number and size of acquisitions, and it engenders extreme and fluctuating organizational performance. The results suggest that narcissistic CEOs favor bold actions that attract attention, resulting in big wins or big losses, but that, in these industries, their firms' performance is generally no better or worse than firms with non-narcissistic CEOs.