IDEAS home Printed from https://ideas.repec.org/a/tei/journl/v8y2015i1p51-82.html
   My bibliography  Save this article

Firm performance: The role of CEOs' emotional and cognitive characteristics

Author

Listed:
  • Kleanthis K. Katsaros

    (University of Macedonia, Department of Accounting & Finance, Egnatia St. 156, 54006, Thessaloniki, Greece)

  • Athanasios N. Tsirikas

    (University of Macedonia, Department of Accounting & Finance, Egnatia St. 156, 54006, Thessaloniki, Greece)

  • Christos S. Nicolaidis

    (University of Macedonia, Department of Accounting & Finance, Egnatia St. 156, 54006, Thessaloniki, Greece)

Abstract

The paper examines the relationships between CEOs’ personal traits, emotions, attitudes and tolerance of ambiguity; and subsequently, the influence of CEOs’ ambiguity tolerance in firms' performance. Design/methodology/approach – Survey data were collected from 256 ICT firms established in Greece. Their CEOs completed questionnaires examining TOA, personal traits, emotions and attitudes in the workplace. Principal components analysis and ordinary least-squares regressions were used to explore the hypotheses of the paper. Findings – Three factors characterize CEOs' emotions, namely pleasure, dominance and arousal; two factors their involvement, namely importance and interest; and, respectively, one their emotional intelligence namely, empathy/handling relationships. Further, locus of control; importance; arousal; empathy/handling relationships and interest affect decisively CEOs' tolerance of ambiguity, which in turn, seems to influence positively firms' performance. Research limitations/implications – Further research is required in Greek ICT industry regarding the influence of CEOs' emotional and cognitive attributes in organizations' financial performance. Likewise, this research should be expanded to other industries. Originality/value – The originality of this study lies in the finding that emotional and cognitive characteristics affect CEOs' TOA, which, in turn, influences significantly firms' performance. Another significant contributing factor is that the study is carried out in Greece, where few studies have been conducted in this area.

Suggested Citation

  • Kleanthis K. Katsaros & Athanasios N. Tsirikas & Christos S. Nicolaidis, 2015. "Firm performance: The role of CEOs' emotional and cognitive characteristics," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 8(1), pages 51-82, August.
    • Handle: RePEc:tei:journl:v:8:y:2015:i:1:p:51-82
    as

    Download full text from publisher

    File URL: https://ijbesar.af.duth.gr/docs/volume8_issue1/firm_performance.pdf
    Download Restriction: no
    File URL: https://ijbesar.af.duth.gr/volume8_issue1.php
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Michael L. McDonald & James D. Westphal & Melissa E. Graebner, 2008. "What do they know? The effects of outside director acquisition experience on firm acquisition performance," Strategic Management Journal, Wiley Blackwell, vol. 29(11), pages 1155-1177, November.
    2. Murphy, Gregory B. & Trailer, Jeff W. & Hill, Robert C., 1996. "Measuring performance in entrepreneurship research," Journal of Business Research, Elsevier, vol. 36(1), pages 15-23, May.
    3. Sucheta Nadkarni & V. K. Narayanan, 2007. "Strategic schemas, strategic flexibility, and firm performance: the moderating role of industry clockspeed," Strategic Management Journal, Wiley Blackwell, vol. 28(3), pages 243-270, March.
    4. Derek C. Jones & Takao Kato, 2003. "The Effect of Employee Involvment on Firm Performance: Evidence from an Econometric Case Study," William Davidson Institute Working Papers Series 2003-612, William Davidson Institute at the University of Michigan.
    5. Benita M. Gullkvist, 2013. "Drivers of change in management accounting practices in an ERP environment," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 6(2), pages 149-174, September.
    6. Begley, Thomas M. & Boyd, David P., 1987. "Psychological characteristics associated with performence in entrepreneurial firms and smaller businesses," Journal of Business Venturing, Elsevier, vol. 2(1), pages 79-93.
    7. Lascelles, David & Dale, Barrie, 1990. "Quality management: The chief executive's perception and role," European Management Journal, Elsevier, vol. 8(1), pages 67-75, March.
    8. Justin Tan & Mike W. Peng, 2003. "Organizational slack and firm performance during economic transitions: two studies from an emerging economy," Strategic Management Journal, Wiley Blackwell, vol. 24(13), pages 1249-1263, December.
    9. Sharon L. Oswald & Kevin W. Mossholder & Stanley G. Harris, 1994. "Vision salience and strategic involvement: Implications for psychological attachment to organization and job," Strategic Management Journal, Wiley Blackwell, vol. 15(6), pages 477-489, July.
    10. Christophe Boone & Bert De Brabander & Arjen Van Witteloostuijn, 1996. "Ceo Locus of Control and Small Firm Performance: an Integrative Framework and Empirical Test," Journal of Management Studies, Wiley Blackwell, vol. 33(5), pages 667-700, September.
    11. Tam Yeuk‐Mui May & Marek Korczynski & Stephen J. Frenkel, 2002. "Organizational And Occupational Commitment: Knowledge Workers In Large Corporations," Journal of Management Studies, Wiley Blackwell, vol. 39(6), pages 775-801, September.
    12. James P. Walsh, 1995. "Managerial and Organizational Cognition: Notes from a Trip Down Memory Lane," Organization Science, INFORMS, vol. 6(3), pages 280-321, June.
    13. Kleanthis K. Katsaros & Athanasios N. Tsirikas & Christos S. Nicolaidis, 2014. "Managers' workplace attitudes, tolerance of ambiguity and firm performance," Management Research Review, Emerald Group Publishing Limited, vol. 37(5), pages 442-465, May.
    14. David J. Wilkinson, 2006. "The Ambiguity Advantage," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-59789-1, October.
    15. Doyle, Peter, 1994. "Setting business objectives and measuring performance," European Management Journal, Elsevier, vol. 12(2), pages 123-132, June.
    16. Kaufman, Bruce E., 1999. "Emotional arousal as a source of bounded rationality," Journal of Economic Behavior & Organization, Elsevier, vol. 38(2), pages 135-144, February.
    17. Asli Demirgüç-Kunt & Enrica Detragiache, 1998. "The Determinants of Banking Crises in Developing and Developed Countries," IMF Staff Papers, Palgrave Macmillan, vol. 45(1), pages 81-109, March.
    18. Tiedens, Larissa Z. & Linton, Susan, 2001. "Judgment under Emotional Uncertainty: The Effects of Specific Emotions and Their Associated Certainty Appraisals on Information Processing," Research Papers 1629, Stanford University, Graduate School of Business.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kleanthis K. Katsaros & Athanasios N. Tsirikas & Sofia-Maria N. Bani, 2014. "CEOs’ Attitudes to Change, Strategic Flexibility and Organizational Performance in Greek ICT Industry," International Journal of Management Sciences, Research Academy of Social Sciences, vol. 4(12), pages 567-581.
    2. Albert Danso & Samuel Adomako & John Ofori Damoah & Moshfique Uddin, 2016. "Risk-taking Propensity, Managerial Network Ties and Firm Performance in an Emerging Economy," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 25(2), pages 155-183, September.
    3. Dimo Dimov, 2007. "Beyond the Single-Person, Single-Insight Attribution in Understanding Entrepreneurial Opportunities," Entrepreneurship Theory and Practice, , vol. 31(5), pages 713-731, September.
    4. Dean A. Shepherd & Jeffery S. Mcmullen & William Ocasio, 2017. "Is that an opportunity? An attention model of top managers' opportunity beliefs for strategic action," Strategic Management Journal, Wiley Blackwell, vol. 38(3), pages 626-644, March.
    5. Yochi Cohen-Charash & Charles A Scherbaum & John D Kammeyer-Mueller & Barry M Staw, 2013. "Mood and the Market: Can Press Reports of Investors' Mood Predict Stock Prices?," PLOS ONE, Public Library of Science, vol. 8(8), pages 1-15, August.
    6. Kayhan Tajeddini & Stephen Mueller, 2009. "Entrepreneurial characteristics in Switzerland and the UK: A comparative study of techno-entrepreneurs," Journal of International Entrepreneurship, Springer, vol. 7(1), pages 1-25, March.
    7. Parida, Vinit & George, Nerine Mary & Wincent, Joakim, 2018. "Strategic diagnosis of information processing structures and commercialization in new ventures," Journal of Business Research, Elsevier, vol. 85(C), pages 83-90.
    8. Kuvaas, Bard & Selart, Marcus, 2004. "Effects of attribute framing on cognitive processing and evaluation," Organizational Behavior and Human Decision Processes, Elsevier, vol. 95(2), pages 198-207, November.
    9. Zhang, Zhu & Lyles, Marjorie A. & Wu, Changqi, 2020. "The stock market performance of exploration-oriented and exploitation-oriented cross-border mergers and acquisitions: Evidence from emerging market enterprises," International Business Review, Elsevier, vol. 29(4).
    10. Patrick Kreiser & Louis Marino & Donald Kuratko & K. Weaver, 2013. "Disaggregating entrepreneurial orientation: the non-linear impact of innovativeness, proactiveness and risk-taking on SME performance," Small Business Economics, Springer, vol. 40(2), pages 273-291, February.
    11. Soriano, Domingo Ribeiro, 2010. "Management factors affecting the performance of technology firms," Journal of Business Research, Elsevier, vol. 63(5), pages 463-470, May.
    12. Linus Chesoli Wekesa & Jackson Maalu & James Gathungu & Gituro Wainaina, 2023. "Mediating Effect of Competitive Strategy Between Entrepreneur Characteristics and the Performance of Non-timber Forest Product SMEs in Kenya," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(4), pages 4293-4317, December.
    13. Sahin, M. & Nijkamp, P. & Rietdijk, M., 2009. "Cultural Diversity and Urban Innovativeness: Personal and Business Characteristics of Urban Migrant Entrepreneurs," Serie Research Memoranda 0033, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    14. Mark DesJardine & Pratima Bansal, 2019. "One Step Forward, Two Steps Back: How Negative External Evaluations Can Shorten Organizational Time Horizons," Organization Science, INFORMS, vol. 30(4), pages 761-780, July.
    15. Desislava I. Yordanova, 2008. "Gender Effects on Performance in Bulgarian Private Enterprises," Working Papers 0806, Departament Empresa, Universitat Autònoma de Barcelona, revised Oct 2008.
    16. Szabó-Morvai, Ágnes & Kiss, Hubert János & Károlyi, Róbert, 2023. "Kontrollhely Magyarországon - egy reprezentatív felmérés eredményei [Locus of Control in Hungary: The results of a representative survey]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 847-871.
    17. Hutzschenreuter, Thomas & Kleindienst, Ingo, 2013. "(How) Does discretion change over time? A contribution toward a dynamic view of managerial discretion," Scandinavian Journal of Management, Elsevier, vol. 29(3), pages 264-281.
    18. Tran, Yen & Truong, Anh Tran Tram, 2022. "Knowledge recontextualization by returnee entrepreneurs: The dynamic learning perspective," Journal of International Management, Elsevier, vol. 28(3).
    19. David H. Weng & Kuo-Pin Yang, 2024. "How does organizational slack influence firm performance? A replication and extension of Peng, Li, Xie, and Su (2010)," Asia Pacific Journal of Management, Springer, vol. 41(1), pages 377-406, March.
    20. Chunjia Hu & Haili Zhang & Michael Song & Dapeng Liang, 2019. "Past Performance, Organizational Aspiration, and Organizational Performance: The Moderating Effect of Environmental Jolts," Sustainability, MDPI, vol. 11(15), pages 1-16, August.

    More about this item

    Keywords

    Ambiguity Tolerance; Attitudes; Emotions; Performance; Personal Traits;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tei:journl:v:8:y:2015:i:1:p:51-82. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kostas Stergidis (email available below). General contact details of provider: https://edirc.repec.org/data/dbikagr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.