Top-Down Influence? Predicting CEO Personality and Risk Impact from Speech Transcripts

Anonymous

Abstract: How much does a CEO's personality impact the performance of their company? Management theory posits a great influence, but it is difficult to show empirically---there is a lack of publicly available self-reported personality data of top managers. Instead, we propose a text-based personality regressor based on crowd-sourced MBTI assessments. The ratings have a high internal and external validity and can be predicted with moderate to strong correlations for three out of for dimensions. Providing evidence for the upper echelons theory, we demonstrate that the predicted CEO personalities have explanatory power of financial risk.