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Taken With a Grain of Salt: Earnings Forecasts From Narcissistic CEOs

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  • Adam Esplin
  • J. Scott Judd
  • Kari Joseph Olsen

Abstract

We examine whether CEO narcissism is associated with management forecast issuance and how investors respond to those forecasts. Narcissists look for opportunities for self‐enhancement, and earnings forecasts provide a setting to demonstrate managerial skills. We find that narcissistic CEOs are more likely to issue management forecasts. We document that forecasts issued by narcissistic CEOs are no more likely to be missed, no more optimistically biased, no less precise, and no less accurate than those issued by non‐narcissistic CEOs. We find that investors respond less favourably to good news management earnings forecasts from narcissistic CEOs. Our results suggest that investors treat management earnings forecasts from narcissistic CEOs as lacking credibility, even though they have similar forecast properties to those issued by less narcissistic CEOs.

Suggested Citation

  • Adam Esplin & J. Scott Judd & Kari Joseph Olsen, 2025. "Taken With a Grain of Salt: Earnings Forecasts From Narcissistic CEOs," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 65(3), pages 2950-2975, September.
    • Handle: RePEc:bla:acctfi:v:65:y:2025:i:3:p:2950-2975
    DOI: 10.1111/acfi.70026
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    References listed on IDEAS

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