The researchers surveyed over 200 CEOs and board members from publicly traded companies in the United States. They found that CEOs with high levels of narcissism were more likely to take risks, such as making large acquisitions or investments, even when the potential for negative outcomes was high. Additionally, these CEOs were more likely to be successful in convincing their boards of directors to support these risky decisions.
The researchers believe that narcissistic CEOs are able to influence boards of directors because they are often very charismatic and persuasive. They are also more likely to be confident in their own abilities and to downplay the potential risks of their decisions. As a result, boards of directors may be more likely to trust the judgment of narcissistic CEOs and to approve their risky decisions.
The study's findings have important implications for corporate governance. Boards of directors need to be aware of the potential risks associated with narcissistic CEOs and take steps to mitigate these risks. For example, boards should ensure that they have a diverse range of opinions and that they are not overly reliant on the input of the CEO. Additionally, boards should be vigilant in monitoring the CEO's decision-making and should not hesitate to challenge decisions that they believe are too risky.
In conclusion, the study suggests that narcissistic CEOs pose a risk to corporate governance and that boards of directors need to be aware of the influence they can have on decision-making. Boards should take steps to mitigate these risks and ensure that they are making decisions in the best interests of the company.
