Experts in the world of accounting and economics have tried for years to identify the forces that account for business success. Specifically, they have focused on what accounts for the return on assets (ROA).
Academic scholars agree that the actions and decisions of the CEO and leadership team account for a significant portion of ROA. Research on the “CEO effect” covers a wide range of managerial characteristics. We have chosen to focus on CEO character, a previously unstudied dimension of leadership behavior. For a good overview of the academic research on ROA variance decomposition studies and the impact of CEO traits, the reader should consult the following articles: