The Impact of CEO Characteristics on Risk Tolerance and Corporate Performance

Research Paper (undergraduate) from the year 2024 in the subject Business economics - Business Management, Corporate Governance, , language: English, abstract: The CEO role is fundamental, as it determines the company's risk tolerance levels and the entire corporate performance. When examining the intricate relationship between CEO role and corporate performance, one key factor that emerges as an apparently significant determinant is the CEO's risk tolerance, since it can profoundly impact the strategic decisions made within an organization, shaping its trajectory and ultimately influencing its financial performance. CEOs with higher risk tolerance levels became inclined to pursue aggressive growth strategies, invest in innovative ventures, and engage in mergers and acquisitions that hopefully drive expansion. On the other hand, CEOs with lower risk tolerance levels opt for conservative approaches, focusing on stability and steady growth.