Zortify Points Out Narcissism As A Risk Factor For Businesses

According to Zortify, a Luxembourgish AI-tech company, CEOs and CFOs who overestimate their own abilities and desire constant admiration and affirmation are most likely to commit fraud and exhibit a lack of integrity.

Photo: Zortify co-founders Marcus Heidbrink and Florian Feltes / Credits @ Zortify

Zortify, a Luxembourgish startup company specialising in an AI-algorithm the deals with human decision-making, has issued “the largest single study worldwide on narcissism”.

“The objective is to identify to what extent narcissism is present in society and especially in companies and top-executive levels,” say the companies co-founders Florian Feltes and Marcus Heidbrink, who conducted the research together with Victoria Berg a consultant and researcher.

Feltes is a professor who teaches on digital leadership and Heidbrink is an organizational psychologist with over 20 years of experience in people diagnostics and management assessment.

Narcissism is commonly defined as “egoism and egocentrism” and as “a reflection not only of an apparent trend in mental illness but also of the strains and distortions in the lives of essentially healthy people”.

However, the definition used in the survey refers to the Canadian personality psychologist Delroy L. Paulhus who describes narcissism as part of the “dark triad”, consisting of the personality traits narcissism, Machiavellianism and psychopathy.

“The dark triad deliberately does not outline pathological personality disorders that require psychological treatment. Rather, it represents subclinical personality traits that are highly, but not pathologically, expressed,” they detail.

“People with narcissistic traits live in a constant ambivalence between unrealistic and self-perceived grandiosity on the one hand and inferiority on the other. Narcissists tend to overestimate their own abilities. Their urge for constant admiration and affirmation is above average. They believe they are someone special and unique, which is why they are entitled to power and high esteem”.

“Narcissism is widespread in management, much more so than in the entire population.”

Narcissism overrepresented in upper management

The survey tested 9,918 people – 5,303 women and 4,615 men – from May to November 2020, with the objective to figure out to what extent this personality trait can correlate with business success, and more particularly how robust it is against social desirability.

The researchers used their own methodology based on a fully automated personality analytics approach: “Up to now, narcissism values have almost exclusively been collected via self-assessment questionnaires,” they explain. “Our study was conducted via a home-made AI-algorithm that evaluated the subjects’ formulated answers to open-ended questions through text analysis”.

The idea of the study emerged after investors expressed concerns on the integrity of top-level managers of firms they were investing in: “They told us that their portfolio losses over the last years were always connected to fraud or non-integrate behaviors from CFOs and CEOs,” both startuppers recall. “They therefore asked us to help assessing narcissism, as it costs billions of damages to companies worldwide.”

The surveyed population included 2,510 managers, 734 of them at board level. “Narcissism is widespread in management, much more so than in the entire population,” the study finds. “This tendency has by no means diminished with New Work and other modern management methods”.

“There is a perfect correlation between narcissism and leadership emergence. The more narcissistic, the higher up the career ladder you go.”

Companies still favour male-dominance

Unfortunately, “many companies tolerate self-promoters in their ranks,” the document adds. “But they continue to convey the ideal of the successful male-dominant manager also known as ‘classic alpha-male leader’ in their promotion programs – and lose talent as a result.”

Another finding says that “there is a perfect correlation between narcissism and leadership emergence”, as the highest narcissism scores are found in top management “the more narcissistic, the higher up the career ladder you go,” the survey notes.

But the study also shows “that women in top management have significantly lower average scores than men.”

However, the authors note that narcissism is particularly widespread among young generations: “The data show it is young men – and even women of the under-30 generation – who scored the highest level in narcissism,” they write. “The most extreme scores were found in men around 30. This is what we call ‘the young bull phenomenon’”.

Hence, the researchers suggest that companies “need to prepare for a more narcissistic generation to come and should analyze this trait when hiring and promoting people”.

Founded in 2018, Zortify headquarters in the Luxembourg-City Incubator and operates a German branch in Cologne. The 10-person company provides assessment and recruitment solutions on personnel selection, transformation processes, cultural development and leadership, based on artificial intelligence and text analysis, to companies including banks and investment management companies.

Check your own level of narcissism with Zortify free self-test: http://narzissmus.zortify.com/

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