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Business Researchers Find CEOs Have Big Hearts During the Pandemic

By Keith Morelli

Professor in front of sign

TAMPA (June 18, 2021) -- An in-depth study of how corporate America responded during the COVID-19 crisis has found something uplifting: Chief executive officers have generally turned out in support of their communities, fulfilling social responsibilities, and in particular, making donations to the community.

The study, coauthored by Tony Kong, associate professor with the USF Muma College of Business’ School of Information Systems and Management and faculty director of the Bishop Center for Ethical Leadership, will appear in the Journal of Applied Psychology, a Financial Times Top 50 journal.

The paper is titled, “How CEOs Respond to Mortality Salience during the COVID-19 Pandemic: Integrating Terror Management Theory with Regulatory Focus Theory.” The authors are Andrew Li, professor at West Texas A&M University; Shih-chi Sana Chiu,(assistant professor at the University of Houston; Russell Cropanzano, professor at the University of Colorado at Boulder; Chien-Wei Ho, PhD student at the University of Houston; and Kong.

“The devastating impact of COVID-19 on many American businesses was reported in 2020 and 2021,” Kong said. “Yet what's encouraging and uplifting to us is that we found that CEOs of many large public firms were fulfilling their social responsibility and helping the community via donations.”

“They demonstrated their self-transcendence,” he said, “in this unprecedented crisis in human history.”

The research project began last year when most of the nation was still in a lockdown to prevent the spread of the deadly pandemic. Many businesses suffered severe losses of revenue and had to lay off or furlough employees. The communities surrounding these corporations, including customers, vendors and contactors, also suffered the consequences of the shutdown.

“We were interested in CEO leadership issues,” Kong said. “We decided to use archival data and textual coding data to study how CEOs responded to the COVID crisis.”

“Surprisingly – in a positive sense – we found that many CEOs were prosocial and led their firms to make donations to the community,” he said. “This is very heart-warming and uplifting. And we found that this is particularly true for CEOs who are promotion focused, that is, who focus on their ideals, aspirations and growth.”

As an example, Jack Dorsey, CEO of Twitter and CEO of Square, donated $1 billion worth of equity in Square to his Start Small to fund COVID-19 relief around the world. This donation represented nearly a third of his net worth. Gene Woods, CEO of Atrium Health, donated $1 million to kick-start the Caregiver Heroes Fund for financial help to employees.

Intrigued by these generous donations, Kong and his fellow researchers wanted to know more about how CEOs, as chief strategists of their respective firms, reacted to the daily rising number of COVID-deaths in the United States.

“To address this question, we integrated terror management theory with regulatory focus theory to examine how CEOs responded to the salience of COVID mortality,” said Kong.

Mortality salience is an acceptance that death is a real part of life – which hit home for so many Americans the past year-and-a-half – and terror management theory is a supposition that explains how individuals react to and cope with the thought of death.

“Anthropologist Ernst Becker in 1973 argued that mortality is a reality of human life,” Kong said. “The prospect of non-existence can be terrifying to human beings. Consequently, when mortality is salient, individuals employ a number of strategies to cope with existential anxiety; otherwise, they would be unable to function effectively.”

Kong found that that mortality salience resulted in many CEOs from S&P 500 firms increasing their focus on the needs of others and not self-interest.

The research shed light on what was in the minds of top leaders, Kong said.

“This crisis is a humanity crisis and top CEOs took responsibility to help reduce human suffering and pain within their capacity,” Kong said. “A misconception about motivation is that people who are promotion focused (focusing on aspirations, ideals, and growth) tend to be unethical.

“However,” he said, “our findings suggest that top leaders who are promotion focused can exhibit ethical and prosocial actions in response to the common threat to humanity.”