Does Company Culture Bring Out The Dark Side Of CEOs?
- “Successful psychopaths” display traits which are widely associated with effective leadership, such as being assertive, creative and charming.
- Do you have to exhibit psychopathic tendencies to be a successful CEO? Not according to new research at Vienna University of Economics and Business (WU Vienna).
- Corruption is a systemic problem that involves managers, companies, legislation and regulation.
At the beginning of last month Elon Musk finally handed Twitter over to a new CEO, Linda Yaccarino, much to the relief of both staff and the 57.5% of Twitter users who voted for him to quit in his own poll.
Until then, Musk repeatedly claimed in a live BBC interview that his dog, Floki, had replaced him as Twitter’s CEO. Even the most ardent animal lovers among the Twitter staff must have felt their own careers were in the dog house, even if Floki is said to wear black turtlenecks beloved of Apple’s Steve Jobs.
They were also the uniform of disgraced Theranos CEO, Elizabeth Holmes, who for the next 11 years will be forced to accept that orange is the new black.
During his turbulent reign as Twitter CEO, the Tesla chief executive cut 75% of Twitter’s employees, implemented abrupt policy changes, and regularly trolled other Twitter users. Musk appears to exhibit several of the characteristics regularly associated with psychopaths: superficial charm, behaviour that conflicts with social norms and a lack of empathy and remorse.
But this isn’t shocking. The link between leadership in the corporate world and non-violent psychopathy is widely acknowledged. These types of psychopathic corporate leaders are prevalent in pop culture, such as the Roy family in the hit HBO show Succession.
Psychopathic leaders may be attracted to leadership positions which give them control over people. These so-called “successful psychopaths” display traits which are widely associated with effective leadership, such as being assertive, creative and charming.
So do you have to exhibit psychopathic tendencies to be a successful CEO? Not according to new research at Vienna University of Economics and Business (WU Vienna).
In-depth assessments of six CEOs who were involved in some of the biggest business scandals of the past few decades show that none of the CEOs fulfilled the diagnostic criteria for psychopathy. The study used the Psychopathy Checklist-Revised (PLC-R) to assess the CEO’s personality traits and see how they lined up.
“The CEOs’ scores are all above the population average – but below the diagnostic threshold for psychopathy,” says Günther K. Stahl from the WU Vienna.
The research, which studied CEOs Richard Fuld at Lehman Brothers, Thomas Middelhoff at Arcandor, and Jeffrey Skilling at Enron, did however find that all the CEOs possessed pronounced Machiavellian tendencies, such as the tendency to manipulate, cheat and lie.
Two CEOs showed narcissistic traits, from feelings of grandiosity and a desire to be constantly praised and admired, to an inability to deal with criticism.
Confidence And Narcissism – The Key To Being A Good CEO?
In fact, individuals with highly narcissistic personalities advance to CEO more quickly than individuals who do not have these personality traits, studies have shown.
Narcissistic individuals have high self-confidence and extremely are self-centred, with arrogant thinking and behavioural patterns.
Elon Musk, despite his failings over Twitter, has enjoyed tremendous business success and wealth as the CEO and founder of SpaceX and his leadership at Tesla. This is at least partly due to his confidence and high level of self-esteem.
Is Company Culture Corrupting C-Suite Executives?
Any “dark” behavioural tendencies within CEOs were limited to the professional sphere, the WU Vienna researchers found.
“This rules out the diagnosis of a personality disorder and raises the question of what role the company plays in bringing out dark personality traits in CEOs,” says Professor Stahl.
The findings suggest that flawed corporate governance systems and a weak “ethical infrastructure” also contributed to the scandals. Professor Stahl says that corruption is therefore a systemic problem that involves managers, companies, legislation and regulation.
So could a systematic company failure be to blame for these so called “psychopaths in the C-Suite”?
A deeper exploration into the ethical infrastructures of the six companies before and at the beginning of these CEOs’ terms of office showed that there were several things that might have contributed to these “dark” behavioural tendencies:
- Ineffective internal governance
- Flawed incentive systems
- A lack of rules of conduct
- Dysfunctional corporate cultures
- A strong pressure to conform within the top management team
This suggests a correlation between a CEO’s personality and their company’s ethical infrastructure. While a company can help to bring out these machoistic and psychopathic tendencies, it can also have a reverse effect: leaders with these qualities can weaken the ethical infrastructure of the company, making it more vulnerable to misconduct.
“A lack of ethical infrastructure can encourage CEOs to let dark tendencies influence their behaviour,” says Professor Stahl.
With this in mind, could it be that companies are to blame for psychopaths in the C-suite?