There has been plenty of news this year about failed CEOs and the damage they have caused. I have often been involved in helping organisations pick up the pieces in the wake of a failed CEO.

The appointment of a CEO is the one valid time that a board or Council has the opportunity to intervene directly in the workings of the business, and they had better get it right.  A good CEO can work wonders and a bad one creates misery for all.

I think it is scary how often governance bodies trust to gut instinct in making such a crucial call, when there is impeccable science to guide the decision.

Here are seven key things to check in making a CEO appointment.

  1. Do not hire CEO’s who do not have superior cognitive ability.  Look for well above average on at least one of the following, and preferably all of them:
    • Verbal reasoning – the capacity to quickly and effectively deal with written and oral communication
    • Numerical reasoning – the same, but with numbers
    • Abstract reasoning. The ability to see the links between things, particularly causative links.  People with high abstract reasoning are ahead of the game, people who are low on this are often surprised by life and can lack an understanding of how their actions affect people.  They often have staff rebellions.
  2. Honesty/humility. This is a “Big Six” personality characteristic.  People who are high on this are truthful, trustworthy and not arrogant.  They are also markedly less likely to go to jail, which is a desirable characteristic in a potential CEO.  High honesty/humility is also associated with lower risks of bullying and harassment, including sexual harassment (Lee and Ashton, 2012).
  3. The job of a CEO is highly pressurised, so low emotionality is a good thing.  Low emotionality means emotionally stable and highly resilient.  Less prey to anxiety and vulnerability.
  4. People who are high on this are approachable, reasonable and slow to anger.  I don’t think you really want a cranky, difficult CEO.
  5. Being a CEO is a hard job.  To do it properly the encumbent needs to be well above population average in conscientiousness.  Conscientious people are organised, determined, and committed to setting and achieving stretch goals.  They work hard.

If you get this combination of characteristics you will be able to be confident that your CEO is balanced, reasonable, capable, resilient, and not a psychopath.  Now there are some good reasons to go to work with confidence.

To find out how to measure these characteristics click here.

 

Andrew Marty
Managing Director
SACS

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Lee, K, Ashton, M, (2012) The H Factor of Personality: Why Some People are Manipulative, Self-Entitled, Materialistic, and Exploitive And Why It Matters for Everyone

 

Andrew Marty
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