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Me, myself and I : CEO narcissism and selective hedging

Bajo, Emanuele ; Jankensgård, Håkan LU and Marinelli, Nicoletta (2022) In European Financial Management 28(3). p.809-833
Abstract

In this paper, we test the hypothesis that CEO narcissism influences firms’ hedging behaviour. Our empirical evidence, based on hand-collected data on derivative positions in the U.S. oil and gas industry, suggests that firms with a narcissistic CEO hedge more selectively. Furthermore, we find that these firms reduce selective hedging comparatively more following a sharp price collapse that sent the industry into a state of distress. This result is in line with the ‘narcissistic paradox’: While scoring high on self-esteem and grandiosity in the normal case, such individuals are also inherently fragile and liable to crumble when faced with adversity.

Please use this url to cite or link to this publication:
author
; and
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
derivatives, narcissism, risk management, selective hedging
in
European Financial Management
volume
28
issue
3
pages
809 - 833
publisher
Wiley-Blackwell
external identifiers
  • scopus:85109357823
ISSN
1354-7798
DOI
10.1111/eufm.12328
language
English
LU publication?
yes
id
26f2a41a-763f-40cb-b4e2-007df8863105
date added to LUP
2021-08-23 12:09:40
date last changed
2022-06-30 12:00:26
@article{26f2a41a-763f-40cb-b4e2-007df8863105,
  abstract     = {{<p>In this paper, we test the hypothesis that CEO narcissism influences firms’ hedging behaviour. Our empirical evidence, based on hand-collected data on derivative positions in the U.S. oil and gas industry, suggests that firms with a narcissistic CEO hedge more selectively. Furthermore, we find that these firms reduce selective hedging comparatively more following a sharp price collapse that sent the industry into a state of distress. This result is in line with the ‘narcissistic paradox’: While scoring high on self-esteem and grandiosity in the normal case, such individuals are also inherently fragile and liable to crumble when faced with adversity.</p>}},
  author       = {{Bajo, Emanuele and Jankensgård, Håkan and Marinelli, Nicoletta}},
  issn         = {{1354-7798}},
  keywords     = {{derivatives; narcissism; risk management; selective hedging}},
  language     = {{eng}},
  number       = {{3}},
  pages        = {{809--833}},
  publisher    = {{Wiley-Blackwell}},
  series       = {{European Financial Management}},
  title        = {{Me, myself and I : CEO narcissism and selective hedging}},
  url          = {{http://dx.doi.org/10.1111/eufm.12328}},
  doi          = {{10.1111/eufm.12328}},
  volume       = {{28}},
  year         = {{2022}},
}