Article by Elena Ising

Photo by Thijs Stoop on Unsplash

If by law, a corporation can be considered a person, then that person would be a psychopath. Corporations exhibit all the classic signs[1] of psychopathy: repeated lying for the purpose of profit, a lack of empathy, inability to experience guilt, and a consistent failure to follow the law. But corporations are not actually people. Behind a corporation, there is often a small group of individuals, or a single individual, that determines the course of the company. Since a corporation is not, in fact, a sentient being and is incapable of developing a personality on its own, someone must be responsible for giving the corporation the persona of a psychopath. The immediate answer is the Chief Executive Officer or CEO.

The CEO of a corporation is almost always the most influential decision maker and often relies on their own personal beliefs and experiences to inform their decisions. Additionally, most CEOs can be described as charismatic, persuasive, and creative, all characteristics associated with effective leadership. Yet, these characteristics are also often associated with high-functioning, intelligent psychopaths, used to mask their underlying lack of empathy and morality, aggressiveness, and narcissism. With psychopaths being mistaken for effective leaders, recent research[2] has found that the frequency of psychopathic CEOs is anywhere between 4% to 12%, similar to rates found in prisons and significantly higher than the prevalence of 1% in the general population. Experts suggest that this high rate is because psychopaths are willing to use their lack of morality and willingness to lie and cheat to help them climb the “executive ladder”, making them more successful than their non-psychopathic counterparts.

Why should we be concerned about this incredibly high number of psychopathic CEOs? Because research has shown that a CEOs psychopathic characteristics affect their company’s participation in corporate social responsibility (CSR) programs, including environmental programs.

As climate change worsens, most of the public has started to call on corporations to change their ways and modify their processes to reflect a greater commitment to sustainability and the environment. But the stronger a CEOs Machiavellian (which includes self-beneficial behaviour and manipulation) and psychopathic traits, the less likely[3] their organization have CSR programs for the environment and society. Upper echelons theory[4] discusses how the traits of executives can explain a company’s actions and outcomes and how most executives refer to their personal beliefs, experiences and dispositions when making corporate decisions. Therefore, since most CSR programs evolve from intracompany efforts rather than stakeholder pressure, corporations and psychopathic CEOs cannot be depended upon to make the necessary changes required to prevent the catastrophic effects of climate change.

We are already seeing the consequences of corporations’ unwillingness to make strides regarding sustainability. A recent survey[5] of CEOs found that of included UK companies only 17% had comprehensive emissions tracking programs, while only 47% tracked emissions at all. Moreover, in the UK, only 41% of companies are on track to meet net-zero deadlines set by the government. Additionally, the climate pledges of 25 household-name, multinational companies have been found to be exaggerated in a recent report by NewClimate Institute[6]. Among these are Nestlé and Unilever, who have previously been praised for their ambitious climate proposals. The report finds that despite making net-zero carbon targets, most companies do not include their full value chain carbon emissions in their goals, misleading the public about the true reduction of their environmental impact.

Despite lacklustre corporate climate pledges and the worrying implications of psychopathic CEOs, examples exist of moral CEOs who recognised the detrimental impact of their corporation and took strides to increase sustainability. Among these was Ray Anderson[7], who started the carpet-tile company Interface, and in 1994 set out to restructure the company with the goal of reaching zero environmental impact by 2020. Anderson demonstrated that most CEOs have the capability to decrease their corporation’s environmental impacts when it is made a priority.

Thus, how can we best combat the psychopathic nature of corporations and their CEOs, and encourage[8] the prioritization of sustainability initiatives? Foremost, we need corporate boards to place greater emphasis on empathy and pro-social characteristics when selecting CEOs, rather than simply focusing on skill. Increased government intervention in the forms of corporate regulation, public investment, and financial incentives are required as well. With the prevalence of corporate psychopaths unlikely to decrease anytime soon, greater effort towards making sustainable efforts become advantageous business decisions is required.

[1] https://www.youtube.com/watch?v=Y888wVY5hzw&t=3681s

[2] https://www.forbes.com/sites/jackmccullough/2019/12/09/the-psychopathic-ceo/

[3] https://www.mdpi.com/2071-1050/9/4/543

[4] https://www.sciencedirect.com/science/article/pii/S0148296319304126

[5] https://www.forbes.com/sites/sofialottopersio/2021/10/27/ceo-climate-change-extreme-weather-impact-business-supply-chain/

[6] https://newclimate.org/2022/02/07/corporate-climate-responsibility-monitor-2022/

[7] https://www.nytimes.com/2007/05/22/science/earth/22ander.html

[8] https://theconversation.com/heres-how-to-convince-ceos-to-support-government-climate-action-at-the-expense-of-their-own-profits-170292

Related