'Narcissistic' bosses perform better financially
Narcissistic CEO's make more money for the business as per a new study.
According to the research co-authored by faculty at the USC Marshall School of Business, narcissism, considered by some as the 'dark side of the executive personality,' may actually be a good thing when it comes to certain financial measures.
The study by Professor of Accounting Mark Young, Professor of Accounting Kelsey Kay Dworkis from University of Melbourne, and Kari Joseph Olsen, doctoral student of accounting, Marshall, found that companies led by narcissistic CEOs reported higher earnings-per-share and share price than those with non-narcissistic CEOs.
Young said that certain traits of narcissists, such as charisma and risk-taking, could make them successful leaders. Their innovativeness and commitment to action could be critical factors in helping their companies succeed and have higher EPS and stock price. But when other facets of narcissism, such as vanity and exhibitionism, are present, a positive impact was less likely.
Researchers studied the accounting-related outcomes of 283 CEOs from 235 unique Fortune 500 firms from 1992-2009, and examined the relationship between CEO narcissism and earnings-per-share, the company's most visible accounting number, and share price, to which CEO compensation usually is tied. Results indicate that companies headed by narcissistic CEOs had higher EPS after controlling for factors related to the CEO, firm and industry. These CEOs achieved this partially through real activities manipulations that increase EPS.
However, this behavior could be detrimental to a company in the long-term, said Young.
The study is published in The Journal of Management Accounting Research.
(Posted on 25-07-2014)
Free Yearly Horoscope: Select your zodiac sign