Businesses which avoid hiring the stereotypical egocentric, corporate warrior as their chief executive might do better at weathering uncertain economic times.
Research measuring the “narcissism” of the chief executives of Australia’s largest listed companies reveals companies led by less self-centred CEOs significantly outperformed those led by more narcissistic personalities in the 18-month period to March 2013.
A team at the Macquarie Graduate School of Management attempted to quantify the narcissism of Australia’s top executives by closely analysing what they said during their responses to shareholders and journalists at annual general meetings – with a special emphasis on how they said it.
They ranked the CEOs based on how often they referred to themselves in the first person (“I” or “me”) as opposed to how often they mentioned “we” and “us”. The more often the CEO used the first person pronouns, the higher their ‘narcissistic’ ranking.
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Professor Alex Frino, dean of MGSM and head of the research team that conducted the analysis, told SmartCompany the research focused on the Q&A section of the annual general meetings, because speeches were more likely to have been edited or written by others.
Professor Frino said companies run by less self-centred CEOs had outperformed those run by the most narcissistic CEOs, but he emphasised this finding only applied during troubled economic times when the risk averse nature of less narcissistic leaders came to the fore.
“Perhaps, if we had extended it back to before the global financial crisis we would have seen very different results,” he said
The research found the most narcissistic CEOs are in the telecommunication services sector, followed by mining. Professor Frino would not be drawn on which CEO was ranked the most narcissistic.
Although Frino did acknowledge more egotistical CEOs were attracted to work with large companies, he also noted his findings that less narcissistic people were better suited to heading up companies during volatile market conditions applied to businesses of all sizes.