The Dark Triad

While the therapy world gnashes its teeth over who is feeling whose feelings, social psychologists are hard at work identifying what it takes to succeed in the real world.

Sometimes they sound like moral philosophers. At other times, they seem to be culture warriors. If you think that capitalists are evil and venal you will accept the theory that people who succeed in business are evil and venal. To put a finer point on it, the social psychologists have previously declared that success in the business world would befall those who possessed the “dark triad,” who were Machiavellian narcissistic psychopaths.

For my part, I find the term “dark triad” to be inspired. It could easily be the title of a horror movie. We should be happy to recognize creativity, regardless of where it comes from.

Anyway, those who think that capitalists are fundamentally bad people, or that you cannot succeed in the dog-eat-dog world of business without being a dog yourself were happy to embrace the dark triad. Some people found it reassuring that their own obnoxious and repellent personality traits had destined them for success. I trust that the same people also love horoscopes.

Now… fanfare, please… researchers have discovered that people who possess the dark triad are less capable and weaker performers. When it comes to running hedge funds, being a narcissist or a psychopath or even manipulative will, in the long run work against you.

The Daily Mail reports the story:

From The Wolf of Wall Street to The Big Short, many films about the financial sector feature people with the 'dark triad' of personality traits - psychopathy, narcissism and Machiavellianism.

But a new study suggests that people with these traits may not necessarily make the best investment decisions compared with 'nice guys'.

This is because they are often overconfident and reckless - causing them to stick with bad investment decisions longer than they should.  

The findings add to a growing body of evidence suggesting that Dark Triad personality traits are not desirable in leaders.

This suggests another slogan: Nice guys finish first. It may not be intuitively obvious, and the research primarily involves investment decisions, but it is good news for those who are working to develop their good character. Who knew that getting along with other people, showing respect and courtesy would make you more successful than seducing and manipulating people in order to pursue a goal more ruthlessly.

The Daily Mail explains the results of the most recent study:

Previous studies have suggested that people with the 'dark triad' of personality traits  make the best managers.

But in a new study, researchers from the University of Denver suggest that this isn't the case.

Dr Leanne ten Brinke, lead author of the study, said: 'We should re-think our assumptions that might favour ruthlessness or callousness in an investment manager.

'Not only do these personality traits not improve performance, our data suggest that they many hinder it.'

One suspects, in passing, that what counts as callous indifference was in many cases a sign of competitive focus, and therefore an absence of empathy for one’s opponents. Such an attitude does not bespeak a personality defect. It is a sign of a competitive personality. It does not matter when you feel empathy for your opponent. What matters is that you display sportsmanship. This coincides with a more cooperative attitude—you cannot compete effectively if you are not a trustworthy teammate.

I am sure you want to know what counts as psychopathy. The newspaper explains:

Psychopaths display different traits depending on their disorder.

Common signs include superficial charm, a grandiose notion of self-worth, the need for stimulation and impulsiveness, pathological lying, the ability to manipulate others and a lack of remorse and empathy.

Of course, getting other people to do what needs to be done because they want to do it, as Eisenhower suggested, is not necessarily manipulative. When you seduce people into doing  your bidding because you want it done you are being manipulative. When you are getting them to do what needs to be done you are leading them. Is it about the leader's personality or the good of the company... the distinction is worth underscoring.

Bloomberg News reports on the same research. It emphasizes the fact that a good investor does not go it alone. He works with other people, shares ideas and respects differences of opinion. He does not try to impose himself on the world:

However, some psychologists have shown that the quality of work exhibited by people with such tendencies [the dark triad] can fall short. “More psychopathic individuals tend to be able to talk the talk, but not walk the walk,” ten Brinke said. Over time—and measured by an objective standard such as investment returns—their shortcomings can become glaringly obvious.

Psychopaths are also very difficult to work with, as one could probably surmise. Investing, like other fields, can require collaboration, listening to the ideas of colleagues, and hiring specialists to execute your strategies.

It concludes with a cautionary note:

“There’s good research to suggest psychopaths are poor leaders,” ten Brinke said. “If you put someone with psychopathic traits [in charge] of a group, they’re more likely to divide the group.”