Researchers from consultancy ghSmart teamed up with economists at the University of Chicago and the Copenhagen Business School—along with psychologists and analysts at SAS and NYU—to comb through a database containing reams of information on 2,000 CEOs, from companies both large and small and across multiple sectors.
The results of the study, dubbed the CEO Genome Project, have formed the basis of a book and were partly revealed in the latest edition of the Harvard Business Review.
After zeroing in on a sample of 930 candidates, 86% of whom were from U.S. companies, and conducting 70 follow-up interviews with CEOs and board members, researchers turned up results that may challenge public stereotypes of successful people.
For one, just over half of the CEOs who exceeded investor expectations were rather shy. Extroverts were more likely to impress in job interviews but all that bluster had absolutely zero bearing on their ability to achieve actual results, ultimately disappointing their backers.
That finding supports a separate study conducted last year by the University of Chicago, Harvard and Stanford that used a linguistic analysis of conference calls to categorize the personality traits of thousands of CEOs from U.S. public companies. It found that individuals who scored highly in extroversion by using bombastic language ran companies with a 2% smaller return on assets. Introverted CEOs, who often hesitated and spoke more conscientiously, ran companies that outperformed their peers.
The CEO Genome project, outlined in more detail here, also found that only 7% of candidates went to an elite school and 8% didn’t even graduate from college—though the percentage of Ivy-league alumni would have been much higher if researchers had focused on the Fortune 100.
Perhaps more surprisingly, nearly all the candidates were found to have made at least one big mistake in the past, such as overpaying for an acquisition. And 45% had experienced a “major career blowup” that ended their job or cost their business a substantial sum of money.
In the end, the researchers identified the four most important traits for CEOs to possess as:
1. Making fast decisions with conviction
2. Reaching out to stakeholders and bringing them on board
3. Being highly adaptable to change
4. Producing reliable and predictable results
Any CEOs or aspiring leaders out there wondering if they fit the mold can take this five-minute online assessment.