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Competitive pressure changes character
by Spektrum der Wissenschaft
A CEO's choice of words reveals whether he has to go
27.9.2025
Translation: machine translated
CEOs who are about to be sacked express themselves differently to those who are allowed to keep their job. Their choice of words reveals what they are currently thinking about.
When Chief Executive Officers (CEOs) are about to be dismissed, their speaking style shows a few peculiarities: They talk about themselves more often, for example. This was reported by economist Ali Akyol and his colleague Sahar Shabani from the University of Ottawa on the platform «S&P Global Market Intelligence» in an analysis of 45,000 quarterly conferences held by companies between 2010 and 2018. In these conferences, CEOs inform the public every quarter about ongoing business, present current operating results and answer questions from financial analysts. The researchers analysed these conference transcripts with the help of tried-and-tested software, Linguistic Inquiry and Word Count (LIWC): it searches texts for around 80 features, including the average frequency of certain word types per sentence - an indication of what the person is thinking about. The statements of CEOs whose days were numbered were compared with those of company bosses who were allowed to keep their job.
When the dismissal was imminent, the CEOs expressed themselves more analytically, spoke more often about themselves and used more words relating to the present and the topic of power. The probability of dismissal was half as high when the pronoun «I» occurred one per cent more frequently. In contrast, emotion-related words, an authentic and determined way of expressing oneself and the increased use of «they» in the third person plural spoke in favour of the CEO staying on. The terminated and non-terminated CEOs differed only slightly from one another. However, the anomalies increased as the day of dismissal approached. In the fourth-to-last conference, almost a year before the dismissal, the researchers did not yet observe any linguistic peculiarities; in the third-to-last conference, subtle «» changes were already occurring; in the penultimate conference, these increased; and in the last conference, they were clearly pronounced.
The researchers conclude that corporate bosses are increasingly realising what lies ahead. Older research has already shown that the language used by CEOs gives an indication of their thoughts and intentions, explain Akyol and Shabani. They interpret the change in expression as an indication that the CEOs wanted to present themselves in a favourable light before their departure.
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Original article on Spektrum.de
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