Upper echelons theory: Research at the nexus of CEO psychological profiles, gender, and firm diversity

Abstract

Upper echelons theory suggests that CEO values and personalities impact their actions, driving organizational performance. However, accessing the black box of a CEO's values and personality is difficult. Numerous studies of senior leaders have informed research on discrete psychological characteristics such as drivers, risk, temporal focus, and emotionality. This study builds on this work by holistically sourcing these psychological characteristics through a LIWC (Linguistic Inquiry & Word Count) text analysis of top-ranked CEO Twitter (X) postings. These data were transformed via a principal component analysis into four distinct psychological profiles, termed by the authors 'grey flannel suits', 'self-actualizers', 'empaths', and 'greyhounds'. Binary logistic regressions suggested divergence in CEO psychological profile occurrences based on firm size. The profile analysis failed to detect significant top CEO gender differences; however, some gender distinctions were discerned from follow-on t-tests of the profile's underlying psychological characteristics. The paper concludes with a call for further top management team psychological profile-informed research.