Single CEOs are more likely to take risks that could boost their businesses' bottom lines, but also increase volatility, according to a study by Nikolai L. Roussanov of The Wharton School at the University of Pennsylvania and Pavel G. Savor, also at the University of Pennsylvania. Single CEOs are also more likely to spend money on capital investments, acquisitions and R&D. But while their investment levels are 10 percent higher than average, their stock-return volatility is 3 percent greater than average.
The authors say the riskier behavior of single CEOs is consistent with evidence that single men in general take on greater risks than their peers who are married in order to enhance their status and appear more attractive to potential mates. (Obviously, the study focused on male CEOs.)
Why It Matters to Your Business: If you want to grow your business, and you're not single, perhaps you should consider hiring a single CEO and get out of his way? (It pains me a bit to type that.) While increasing status is a major impetus for taking risks, the authors note that even single men who aren't actively seeking mates might be risk-takers. One possible explanation—single people might be more comfortable with risk than their married peers. Maybe the authors have found a scientific reason why so many fast-growth startups are helmed by younger, single men.
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