A great CEO or a psychopath?

What can a board do to distinguish between a great CEO and a psychopath who will lose track of reality? The key distinction is ethics.

One of the hot topics for business books these days is the study of the psychopathic characteristics of CEOs. According to author Kevin Dutton, CEOs are the profession with the highest percentage of psychopaths. (CEO is a position, not a profession, but never mind.) Author Jon Ronson finds CEOs to be four times more likely than others to exhibit all the attributes of a psychopath, including narcissism, a lack of empathy, a high degree of charm that is used to manipulate others and the ability to stay cool while taking big risks. CEO psychopaths are also smart and have the self-control not to murder their colleagues to get ahead.

I am struck by the fine line between the definition of a psychopath and what we teach in leadership development programs. Aspiring students are urged to develop self-confidence and to seek out and ask for opportunities. Women are told that men apply for jobs when they have, at best, 60% of the qualifications whereas women wait until they have 100%, so they should start acting like men. People are advised to have an elevator speech, so they can introduce (brag about) themselves in 30 seconds to an important stranger. In other words, succeed in business by focusing intensely on yourself. How is this different from narcissism?

The more senior you get in business (or government or the military), the more you are called upon to make decisions that hurt people. You sacrifice people (fire employees, reduce benefits, send young men to war) for the “greater good.” We would like to believe leaders treat people fairly (pay appropriate severance, make equitable decisions about who stays and who goes), but they are still changing people’s lives. Arguably, empathy is a wasted emotion.

Is this lack of empathy a personality disorder or the result of success? Recent studies have demonstrated that as wealth and social status increase, we are increasingly less likely to feel compassion toward others. As all the movies about Wall Street demonstrate, we are not surprised when greed and success breed more greed and success (although, in fiction, there is usually a satisfying comeuppance at the end).

Using charm to manipulate others is, by another name, charisma. We admire larger-than-life leaders, and tend to turn to them when opportunities on the career ladder become available. Yes, results count too, but clever manipulators learn the techniques. Identify and fight for the brightest employees (ideally, people who are not themselves very ambitious) to get the work done. Develop a reputation as a good mentor (but only mentor people who will be useful to you). Keep a sharp focus on what deliverables are most valued by the organization and don’t waste time on the others. Build a stable of relationships with powerful and influential people with whom you can trade favours.

And we are all advised to take risks in our careers. Lean in, do something that scares you, don’t be afraid to fail. The CEOs we most admire are those who have taken a big risk and brought it off — although the punishment for failure can be severe, those we sneer at most are leaders who are considered to be too timid to do much of anything (consider President Obama’s current brand).

What can a board of directors do to distinguish between a great CEO and a psychopath who will lose track of reality, make extreme decisions and bring everything down around him or her? I believe the key distinction is ethics.

One final attribute of a psychopath is the inability to distinguish right from wrong. Of course, a charming manipulator can talk about ethics in a convincing way. But ask the executive aspiring to the top job a key question: “Tell us about some situations in which you made the right ethical decision even though there was a cost to you.” Then listen closely to the answer.