CEO Narcissism, Subsidiary Top Management Team International Diversity, and Radical Digital Innovation in Multinational Enterprises

Drawing on the extended agency model of narcissism and upper echelons theory, we develop a theoretical framework that examines the interface between chief executive officers (CEOs) and foreign subsidiary top management teams (TMTs) and the radical digital innovation of multinational enterprises (MNEs). We posit that CEO narcissism and the international diversity of foreign subsidiaries’ TMTs positively influence an MNE’s radical digital innovation. However, we also argue that this international diversity of foreign subsidiaries’ TMTs weakens the influence of CEO narcissism on radical digital innovation. These hypotheses gain support from empirical analyses of a sample of 3,064 firm-year observations comprising 769 CEOs from 347 South Korean MNEs between 2011 and 2020. Our findings underscore the importance of CEO personality traits, i.e. narcissism, and TMT composition, i.e. international diversity, at the intersection between strategic leadership and radical digital innovation.