Star CEOs with MBAs more self-serving, study finds

A recent study found an unflattering association between the Master of Business Administration degree and self-serving behavior.

The study, published in the Journal of Management Inquiry, may provide some evidence to support anecdotes that CEOs' management philosophies are increasingly self-serving, sometimes to the detriment of their companies. To explore this phenomenon, researchers Danny Miller, PhD, and Xiaowei Xu, PhD, studied a subset of executives who had been featured in laudatory cover stories of top national business magazines, including Business Week, Fortune and Forbes.

They chose celebrated CEOs because preeminence could be a "consequence" and a "facilitator" of self-serving behavior. To this point, they note, their findings may not apply to lesser-known, less successful CEOs. Furthermore, Drs. Miller and Xu caution the study only tracked behavior and outcomes, not motives, and that it does not necessarily indicate MBA educations are the root cause of self-serving behavior.

"We have not been able to establish whether current MBA programs actually promote self-serving behavior in subsequent careers or whether those with a selfish bent seek out MBA educations," the authors wrote.

Nonetheless, their research of 40 years of cover story CEOs shows those with MBAs were more likely to be associated with costly initiatives to accelerate growth, such as acquisitions. They also found these initiatives frequently led to inferior returns on assets and reduced cash flows.

Even though the MBA-educated leaders were associated with more aggressive growth initiatives and company decline, the study shows MBA executives earned greater post-cover compensation than their non-MBA counterparts.

While hospitals and health systems should beware of the self-serving CEO who chases the short-term glory of rapid, costly acquisitions, the findings should be taken with a grain of salt. "Readers would be wise to remember that journalists tend to capture subjects when they do something exceptional, a pursuit that is difficult to sustain, even by many of the non-MBAs in our study," the authors concluded.


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