In what may be the least surprising finding by a study since the one that concluded that people are happier on the weekend, researchers recently found that more narcissistic CEOs like to “go big or go home” when it comes to M&A. Here’s an excerpt:
We find that highly narcissistic CEOs spend more money on corporate acquisitions than less narcissistic CEOs and that highly narcissistic CEOs favor size over quantity when making corporate acquisitions. Furthermore, we find that such irrational focus on size over quantity is penalized by the stock market. Our findings are based on UK non-financial firms and contribute to the existing literature by investigating preferences of narcissistic CEOs in the corporate acquisition arena and the stock market’s reactions to such preferences.
I guess one question you might have is exactly how these folks decided how narcissistic a particular CEO was? It turns out the answer is based on three little words – “I, me, mine.” The primary indicator that the study used for narcissism was how many times the CEO used first person singular pronouns in quarterly earnings conferences.
– John Jenkins