The Role of CEO Personality in Company Management

143 Pages·2016·0.73 MB·English

The Role of CEO Personality in Company Management:
Examining how CEO Narcissism Influences and is
Influenced by Individual and Organizational
Characteristics

Inauguraldissertation
zur Erlangung des akademischen Grades
eines Doktors der Wirtschaftswissenschaften
der Universität Mannheim

Jing Wang
vorgelegt im Frühjahrs-/Sommersemester 2016
Dekan: Prof. Dr. Dieter Truxius
Referent: Prof. Dr. Torsten Biemann
Koreferent: Prof. Dr. Matthias Brauer

Tag der mündlichen Prüfung: 17.05.2016
Acknowledgments
Acknowledgments
During my PhD study at University of Mannheim, I benefited a lot from so many people. I
would like to take this opportunity to express my sincere appreciation and gratitude to all the
people who have supported me during this period.
First and foremost, I would like to extend my heartfelt gratitude to my supervisor,
Prof. Dr. Torsten Biemann, for his constant encouragement and invaluable guidance. With
patience and prudence, he has been always available for anything I would like to discuss with
him, consistently provided me with instructive advice and useful suggestions to develop my
research interests, and exerted great efforts to improve our three joint projects. The thesis
would not have been possibly done without his consistent and illuminating instruction.
Moreover, I owe special thanks to my thesis reviewer Prof. Dr. Matthias Brauer and I really
appreciate his time and efforts.
My cordial and sincere thanks also go to my colleagues from the Chair of Human
Resource Management and Leadership for their suggestions on my regular presentations in
the seminars.
In addition, I gratefully acknowledge financial support from the China Scholarship
Council. I also highly appreciate the administrative assistance I received from the staff of
CDSB and the dean’s office.
I would also like to thank my family: My parents and my sister for supporting me
spiritually throughout writing this thesis and my life in general. And finally, infinite thanks to
my lovely husband as well as my son. Here I dedicate this dissertation to them.

I
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Table of Contents
Table of Contents
Acknowledgments ······················································································ I 
Table of Contents ····················································································· III 
List of Figures ························································································ VII 
List of Tables··························································································· IX 
List of Abbreviations ················································································· XI 
1  Introduction ·························································································· 1 
1.1  Motivations and Main Research Questions ················································ 1 
1.2  Empirical Approach ··········································································· 6 
1.2.1  Data Resources ········································································· 6 
1.2.2  Analytical Approach ··································································· 8 
1.3  Overview of the Chapters ··································································· 10 
2  CEO’s Social Status, Narcissism, and Firm Performance: A Cross-lagged Analysis
of Causal Relations ················································································ 11 
2.1  Introduction ··················································································· 11 
2.2  Theoretical Background and Hypotheses ················································· 13 
2.2.1  The Relationship between a CEO’s Social Status and CEO Narcissism ···· 13 
2.2.2  The Relationship between a CEO’s Social Status, CEO Narcissism and Firm
Performance ······················································································ 17 
2.3  Methods ························································································ 21 
2.3.1  Sample and Data Collection ························································· 21 
2.3.2  Measures ··············································································· 21 
2.3.3  Analysis ················································································ 24 
2.3.4  Results ·················································································· 25 
2.4  Discussion ····················································································· 31 
2.4.1  Causal Relationships between a CEO’s Social Status and CEO Narcissism 32 
2.4.2  The Role of a CEO’s Social Status and CEO Narcissism on Firm
Performance ······················································································ 33 
2.4.3  The Role of Firm Performance for a CEO’s Social Status and CEO
Narcissism ························································································ 33 
2.4.4  Practical Implications ································································ 34 
2.4.5  Limitations and Further Research ·················································· 35 
III
Table of Contents
3  The Dynamic of CEO-Board Relationships: Board Power, CEO Narcissism, and
Their Effect on Company Strategy ····························································· 37 
3.1  Introduction ··················································································· 37 
3.2  Theoretical Background and Hypotheses ················································· 41 
3.2.1  The Relationship between Board Power and the Selection of Narcissistic
CEOs ·························································································· 44 
3.2.2  The Relationship between CEO Narcissism and Board Power ················· 47 
3.2.3  CEO Narcissism, Board Power, Strategic Change and Firm Performance ···· 49 
3.3  Methods ························································································ 53 
3.3.1  Sample and Data Collection ························································· 53 
3.3.2  Measures ··············································································· 54 
3.3.3  Results ·················································································· 60 
3.4  Discussion ····················································································· 66 
3.4.1  The Interrelations between Board Power and CEO Narcissism ················ 67 
3.4.2  The Relationship among CEO Narcissism, Board Power, and Strategic
Change ·························································································· 68 
3.4.3  The Moderated Mediation Effect of CEO Narcissism on Firm Performance. 69 
3.4.4  Practical Implications ································································ 69 
3.4.5  Limitations and Further Research ·················································· 70 
3.5  Conclusion ····················································································· 72 
4  The Effects of CEO Narcissism on Risk Taking and Director Selection: Evidence
from an Online Experiment ······································································ 73 
4.1  Introduction ··················································································· 73 
4.2  Theoretical Background and Hypotheses ················································· 78 
4.2.1  The Relationship between CEO Narcissism and Risk Taking ·················· 78 
4.2.2  The Relationship between CEO Narcissism and the Power of New Directors ··
·························································································· 79 
4.2.3  Moderating Effect of Firm Performance ··········································· 81 
4.3  Methods ························································································ 82 
4.3.1  Sample ················································································· 82 
4.3.2  Procedure ·············································································· 82 
4.3.3  Measures ··············································································· 83 
4.3.4  Results ·················································································· 85 
4.4  Discussion and Conclusion ·································································· 91 
IV
Table of Contents
4.4.1  The Relationship between CEO Narcissism and Risk Taking ·················· 91 
4.4.2  The Relationship between CEO Narcissism and the Power of New Directors ··
·························································································· 91 
4.4.3  The Effect of Firm Performance ···················································· 92 
4.4.4  Practical Implications ································································ 93 
4.4.5  Limitations and Further Research ·················································· 93 
5  Conclusion ··························································································· 95 
5.1  Theoretical Implications ····································································· 96 
5.2  Practical Implications ········································································ 99 
5.3  Limitations and Future Research ························································· 101 
Appendix to Chapter 4 ············································································· 105 
A.1 Measurement Items of Narcissism ······················································· 105 
A.2 Measurement Items of Other Personalities ············································· 107 
Bibliography ·························································································· 109 
Curriculum Vitae ···················································································· 129 

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List of Figures
List of Figures
Figure 2.1 The Final Structural Model ..................................................................................... 25 
Figure 3.1 Overview of the Research Model ........................................................................... 40 
Figure 4.1 Overview of the Research Model ........................................................................... 77 
Figure 4.2 Screen Image of the Risk Taking Task (Deck et al., 2012) .................................... 84 

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