Prize Lorenz Graf-Vlachy wins EURAM “Most Inspirational Paper” award
The Senior Research Fellow and his co-authors were rewarded for a paper about CEOs’ communication with securities analysts.
Lorenz Graf-Vlachy, who is a Professor of Strategic Management and Leadership at TU Dortmund University and a Senior Research Fellow at ESCP, together with his co-authors Ann-Kathrin Schill, Angelo Boutalikakis, Friederike Hawighorst, and Andreas König (all from the University of Passau) received the “Most Inspirational Paper” award in the Strategic Management Special Interest Group’s Behavioral Strategy track for their paper entitled Analyst flattery, CEO narcissism, and CEO communication specificity during the European Academy of Management’s annual conference held in Zurich (Switzerland).
Analysts can influence CEOs’ external communication to their advantage
“Communication toward external parties is one of the most important tasks of a chief executive officer (CEO),” the authors explain. “This is particularly true for communication with securities analysts because they impact investors’ perception of a firm. As such, analysts are a crucial interface between the firm and capital markets, and a key audience for CEOs’ communication.”
In their paper, they investigate how and under which circumstances CEO communication specificity is influenced by analysts’ use of a very common social influencing behavior: flattery. “Prior research suggests that analysts benefit from more specific CEO communication, that is, communication that leaves little room for interpretation by using clearly defined numerical terms, referring to definite amounts, and invoking concepts with a broadly shared meaning.”
The authors find that flattery is, in fact, one way in which analysts can increase the specificity of information they receive from CEOs. In addition, the authors find that this effect is more pronounced for CEOs that are more narcissistic and thus more susceptible to flattery. “It’s still an early-stage project and we have a limited dataset, rendering our conclusions a little tentative,” adds Lorenz Graf-Vlachy. “But the findings are cool: if analysts kiss up more in conference calls with CEOs, the CEOs answer their questions more precisely. And the more narcissistic the CEOs are, the better that strategy works.”