This study focuses on CEO hubris and its detrimental effect on corporate financial performance along with an examination of critical corporate governance contingencies that may moderate the negative effect. From 654 observations of 164 Korean firms over the years 2001–2008, we found that CEO power exacerbated the negative effect of CEO hubris on corporate financial performance, whereas board vigilance mitigated it. This study provides empirical evidence that entrenchment problems arising from CEO hubris would be exacerbated as CEOs become more powerful, (...) but weakened as board of directors become more vigilant. Theoretical contributions and practical implications will be discussed. (shrink)

What, if anything, is wrong with high executive compensation? Is the common “lay reaction” of indignation and moral outrage justified? In this paper, my main goal is to articulate in a more systematic and philosophical manner the egalitarian responses to these questions. In order to do so, I suggest that we take some insights from recent debates on two versions of egalitarianism: a distributive one, according to which no one should be worse off than others because of unfair distributions of (...) goods and resources, especially ones based on matters of luck or arbitrary factors, and a relational one, which maintains that egalitarian justice requires members of a society to relate to one another as equals. Drawing on recent attempts to highlight the tricky nature of managerial authority, I argue that high inequalities in pay are not simply a distributional matter but should also be analyzed through a relational lens. I also attempt to show that relational egalitarians are well-equipped to question the now dominant “incentives” view of CEO compensation. (shrink)

This article explores the link between CEOs’ language and hubristic leadership. It is based on the precepts that leaders’ linguistic utterances provide insights into their personality and behaviours; hubris is associated with unethical and potentially destructive leadership behaviours; if it is possible to identify linguistic markers of CEO hubris then these could serve as early warnings sign and help to mitigate the associated risks. Using computational linguistics, we analysed spoken utterances from a sample of hubristic CEOs and compared them with (...) non-hubristic CEOs. We found that hubristic CEOs’ linguistic utterances show systematic and consistent differences from the linguistic utterances of non-hubristic CEOs. Demonstrating how hubristic leadership manifests in CEO language contributes to wider research regarding the diagnosis and prevention of the unethical and potentially destructive effects of hubristic leadership. This research contributes to the wider study of hubris and unethical leadership by applying a novel method for identifying linguistic markers and offers a way of militating against the risk of unethical and destructive CEO behaviours induced or aggravated by hubristic leadership. (shrink)

The research theorizes how hubris impacts ethical decision making and develops empirical evidence that earnings manipulation is more likely at firms led by CEOs influenced by hubris. The theory posits that hubris impairs moral awareness by causing decision makers to ignore external factors that otherwise drive such awareness. Additionally, these individuals apply a flawed subjective assessment of the decision they face which further impairs moral awareness. The predicted result is that hubris leads managers to invoke an amoral decision process which (...) causes a higher incidence of unethical behavior among these individuals. An empirical study investigates the relationship between CEO hubris and the unethical practice of earnings manipulation. This study finds a significant correlation between CEO hubris and earnings manipulation at the firms they lead, an outcome broadly consistent with the theory developed. (shrink)

Today, capitalism is in question, as the 2013 Academy of Management conference theme claimed. Many view business skeptically because they see capitalism as incompatible with ethics. The same problem pervades the business ethics education classroom. Business ethics can be taught in a way that demonstrates that economics and ethics are compatible and are integrated most directly in the function of management. This essay provides an overview of Ayn Rand’s philosophy as an alternative to current conventions but largely consistent with approaches (...) such as virtue ethics and conscious capitalism. The essay concludes with challenges to teaching Objectivism in business schools. (shrink)

I propose a leadership theory with moral concerns at its core. Sāttvika leadership is defined as a set of purposive leader actions comprising knowledge-driven cooperation that are initiated on the basis of positive and reasonably accurate assumptions and executed through morally responsible and sustainably fruitful means to secure the flourishing of followers and the collective. SL enhances psychological capital, psychological empowerment, and work engagement of followers while developing them into morally better persons. It enhances their trust on the leader and (...) fellow followers. Further, it develops ethical climate of the organization. (shrink)

The academic literature on unethical leadership is witnessing an upward trend, perhaps given the magnitude of unethical conduct in organisations, which is manifested in increasing corporate fraud and scandals in the contemporary business landscape. Despite a recent increase, scholarly interest in this area has, by and large, remained scant due to the proliferation of concepts that are often and mistakenly considered interchangeable. Nevertheless, scholarly investigation in this field of inquiry has picked up the pace, which warrants a critical appraisal of (...) the extant research on unethical leadership. To this end, the current study systematically reviews the existing body of work on unethical leadership and offers a robust and multi-level understanding of the academic developments in this field. We organised the studies according to various themes focused on antecedents, outcomes and boundary conditions. In addition, we advance a multi-level conceptualisation of unethical leadership, which incorporates macro, meso and micro perspectives and, thus, provide a nuanced understanding of this phenomenon. The study also explicates critical knowledge gaps in the literature that could broaden the horizon of unethical leadership research. On the basis of these knowledge gaps, we develop potential research models that are well grounded in theory and capture the genesis of unethical leadership under our multi-level framework. Scholars and practitioners will find this study useful in understanding the occurrence, consequences and potential strategies to circumvent the negative effects of unethical leadership. (shrink)

This study examines some antecedents and consequences of ethical leadership. Using a dataset from the King James Version of the Bible, I argue for and propose that maternal influence will lead to leaders being ethical while paternal influence appears to have no impact on leaders being ethical. I also argue and propose that ethical leaders are more likely to achieve longer tenures and to lead their organizations to better performance. I develop propositions based on the findings from the analysis of (...) my qualitative and quantitative data. (shrink)

This conceptual article introduces behavioral perspectives into the governance arena and undertakes a psychological assessment of managerial decision making in organizations by elaborating on the treatment of trust and pride in the extant literature. While trust is conceived by governance scholars as a device for monitoring relationships with others, we argue that authentic pride, contrary to hubris, could operate as an attribute of emotional self-regulation allowing corporate leaders to govern the social behavior of their own self. Contrasting the features of (...) trust and authentic pride, we advance several propositions to capture their relevance and simultaneous importance as viable governance mechanisms in light of a manager's level of cognitive moral reasoning. Our study builds a unified theoretical framework of governance which integrates human agency, psychological states, and moral judgment to foster a deeper understanding of complex self-regulatory processes that are activated by decision makers in the execution of their roles. (shrink)