Corporate psychopaths

Unmissable by way of Money Science, how the financial crisis emerged from an industry of business and finance that actively recruits social psychopaths due to their superior skills in morally unconstrained decision making. The original article is an essay by my fellow Bloomberg columnist William Cohan:

It took a relatively obscure former British academic to propagate a theory of the financial crisis that would confirm what many people suspected all along: The “corporate psychopaths” at the helm of our financial institutions are to blame.

Clive R. Boddy, most recently a professor at the Nottingham Business School at Nottingham Trent University, says psychopaths are the 1 percent of “people who, perhaps due to physical factors to do with abnormal brain connectivity and chemistry” lack a “conscience, have few emotions and display an inability to have any feelings, sympathy or empathy for other people.”

As a result, Boddy argues in a recent issue of the Journal of Business Ethics, such people are “extraordinarily cold, much more calculating and ruthless towards others than most people are and therefore a menace to the companies they work for and to society.”

Money science also links to this article by Brian Basham, also describing Boddy's work. Listen to this:

Cut to a pleasantly warm evening in Bahrain. My companion, a senior UK investment banker and I, are discussing the most successful banking types we know and what makes them tick. I argue that they often conform to the characteristics displayed by social psychopaths. To my surprise, my friend agrees.

He then makes an astonishing confession: "At one major investment bank for which I worked, we used psychometric testing to recruit social psychopaths because their characteristics exactly suited them to senior corporate finance roles."

Here was one of the biggest investment banks in the world seeking psychopaths as recruits.

The Money science article goes on to give a surprisingly long list of recent books and papers which have explored the role of psychopathology in finance and other corporations. All heart warming stuff, further evidence, I guess, that we really do live in highly civilized and well organized societies.