In today’s climate of hyperpolarization, more and more CEOs openly display their political beliefs — sometimes to the point of making them a core part of their identity. Elon Musk, for instance, doesn’t shy away from expressing his views on free speech, U.S. politics, or culture-war controversies. But can this kind of partisanship influence the ethical conduct of a company?
A study published in the Academy of Management Journal by Thomas Fewer and Murat Tarakci sheds empirical light on this question. The authors show that the more politically partisan a CEO is, the more likely their company is to be linked to ethical misconduct — including fraud, anti-competitive practices, illegal pollution, or abusive treatment of employees.
The researchers analysed a sample of 873 U.S. CEOs between 2010 and 2018, combining their political contributions (from public FEC records) with documented cases of misconduct drawn from the Violation Tracker database. The results are striking: political orientation in itself does not matter — companies led by Democrat and Republican CEOs are equally exposed to wrongdoing. What makes the difference is the degree of partisanship: the more strongly a CEO identifies with a party, the higher the risk of misconduct. The relationship follows an inverted U-shape: moderate CEOs are least at risk, while the most partisan — whether on the left or the right — are associated with more frequent ethical lapses.
The authors point to two mechanisms behind this effect. First, partisan CEOs tend to be less receptive to divergent perspectives, including those of internal and external stakeholders. Second, they often feel a sense of moral justification, which can lead strongly ideological leaders to view themselves as morally legitimate even when engaging in questionable behaviour.
The study does not argue that CEOs with political convictions should be avoided. Rather, it suggests that boards of directors should pay close attention to the effects of strong partisan identity on decision-making. A rigid ideological stance can reduce sensitivity to warning signals, reinforce strategic blind spots, and expose organizations to greater reputational or legal risks.