Are you starry-eyed at your boss’ superstar appeal? Rebecca Pardon explores the rise in star CEOs. This article is from Communicate magazine's print issue.

When OpenAI’s disgruntled board attempted to oust its CEO, Sam Altman, last year, a subsequent coup saw the majority of the company’s staff, along with lead investor Microsoft, signalling that they would rather work with Altman than with a version of OpenAI without him. When reinstated as CEO shortly after, Altman must have felt not only secure in his position, but indispensable.

Seemingly indispensable leadership figures are popping up across the technology sector. These individuals often spurn expensive suits in favour of Uniqlo basics, giving the impression of preoccupied genius and an aloof magnetism that embodies everything which makes their businesses special. Unsurprisingly, superstar CEOs with cult-like followings can pave the way for instability, and things begin to go wrong when adulation goes to leaders’ heads as they begin to believe themselves not only indispensable, but infallible.

When hoping to inspire confidence and trust, leadership figures in politics often look slick and polished, with squeaky-white smiles and navy suits; some of the more audacious among them may opt for a novelty tie. But Silicon Valley’s idea of a charismatic leader is not quite the same as the political world’s. To watch Altman speak on stage it not to be struck by slick oratorical skill or natural aplomb. FTX founder Sam Bankman-Fried paired t-shirts that had suffered a few too many wash cycles with cargo shorts, sneakers and crumpled down socks. His obstinately unruly bedhead, which gave an almost halo-like effect, was only trimmed once Bankman-Fried was on trial for financial fraud earlier this year, apparently sheared by a fellow inmate.

In his new book ‘Going Infinite’ about Bankman-Fried, Michael Lewis describes this as “the hairdo of a lunatic.” Lewis also writes that Bankman-Fried admitted to having “general disdain” for the importance of “physical attractiveness.” Far from the Savile Row suits and Charvet ties of Wall Street, the look lent Bankman-Fried the impression of someone unconcerned with public appearances, and perhaps too preoccupied with greater things to care. But when FTX collapsed after two years, his sloppy dress sense suddenly seemed less a reflection of a higher calling than a warning of his sloppy approach to managing other people’s money.

"We are more susceptible to leaders the more uncertainty and ambiguity there is. Charismatics can step in and say 'you know what? I have this very optimistic view of the future'"

However, such appearances can be surprisingly effective when curating a myth of supremacy. In an interview with Business Insider, Anthony Scaramucci, who had bought Bankman-Fried a suit when on a fund-raising trip in the Middle East weeks before FTX’s implosion, said that he had thought the American entrepreneur “was the next Mark Zuckerberg of crypto.” He received this impression because “the Meta CEO walked around Davos in a hoodie and t-shirt.”

It is this image of someone so misty-eyed by their aspirations for world peace, space colonisation or self-driving cars to notice if their socks match, paired with a jargon-heavy vocabulary, that we find beguiling. Vilmos Misangyi, professor of strategic management at Pennsylvania University, says we are allured by leadership figures who propose a path towards the future we like. “When we see people as charismatic, it is an identity thing. People often identify with people who they see as high performers and who are very visionary, because they seem to see the future and are willing to guide you along a path towards it.

“We are more susceptible to leaders the more uncertainty and ambiguity there is. Charismatics can step in and say 'you know what? I have this very optimistic view of the future'. Charismatics are always very quick to say how the past and the status quo are intolerable.”

From crumpled down socks to Colgate smiles, unshakeable eye contact to the ‘gift of the gab’, it can be difficult to pinpoint what charisma actually is. Misangyi refers to Max Weber, a German sociologist (1864-1920), who was the first to develop charisma into a secular concept to be studied, and described an aura of 'other worldliness'. “The way Weber describes it, when we see people as charismatic, we really believe that these people are somehow in touch with the divine, or they understand what the right values are.

“There are two sides to charisma: the emotional contagion side, through which we are captivated by someone’s energy and enthusiasm, and the cognitive side, where we are drawn to someone’s apparent clarity of values.”

Although some of the most fascinating and abrasive recent examples of charismatic leaders have emerged from the tech sector, concocting visions of a brighter future to appeal to followers is nothing new. “Barack Obama and Tony Blair are so different to Elon Musk and Donald Trump but, in general, they all do the same thing. They play out what the future is going to hold, and they're willing to talk in moral overtones and very value-oriented ways,” says Misangyi

Oddi Aasheim, managing partner at consultancy FirstHuman, describes charisma as the ability to draw people in. “They all see something new to be possible and can bring a future state to life through their actions and words. They listen carefully and connect that future with what their listeners care about and find important.

“Some may bring to life a future state that brings glory and acclaim, others one that bring security and wealth, others an opportunity to rebel and tear down constructs around them that they don’t agree with.”

Bankman-Fried is only one of many recent examples of charismatics gone bad, and it appears we have learnt little from the lesson served by Elizabeth Holmes only a few years earlier. Holmes’ conviction of fraud in connection to her blood-testing company, Theranos, launched a flurry of articles condemning Silicon Valley’s ‘fake it until you make it’ culture. For Holmes, the story is a particularly fascinating one because she began not by faking her products, but by faking her style of leadership through an extensive turtleneck collection of only subtly varying hues of black and perfecting the art of not blinking.

Her imitation of Steve Jobs was completed by lowering her voice an octave, lending her words a solemn gravitas once you had gotten over the initial surprise. An unlikely fashion icon, it was not because Jobs was so stylish that Holmes felt inspired, but because his stubbornly minimalistic appearance was integral to his charisma and to Apple’s brand. Jobs’ image alone was so inspiring that he had charismatic appeal even despite the notorious mood swings that him unpopular with those that knew him personally.

In his study ‘In Charisma We Trust: The Effects of CEO Charismatic Visions on Securities Analysts’, published in 2009, Misangyi explores the relationship of charismatic leadership figures with close and distant stakeholders; he summarises that, for distant audiences, symbolism becomes more important. “Visionary statements are one of the fundamental symbolic actions through which charisma has its effects.”

The instability caused by charismatic leaders can range from the scandalous to the bizarre. While there is a big difference between the drama at OpenAI or Musk’s antics at X and the scandalous downfalls of Bankman-Fried or Holmes, the common feature is the larger-than-life leader who appears bigger than their business. When the directors at Telsla agreed to pay Musk a $55.8bn (£44bn) pay package, it may be because they were feeling generous. Or, as Delaware Chancery Court judge Kathleen McCormick suggested when cancelling the deal, they were “starry-eyed”, swayed by Musk’s “superstar appeal” and “swept up by the rhetoric” surrounding the CEO.

Anglo-American societies tend to focus on the individual and within the tech sector, despite priding itself on being egalitarian, this seems the most pronounced. “The tech sector specifically is somewhat of a paradox,” says Misangyi. “On the one hand, the whole environment is the idea of innovation and constant change in creation, and that's the whole milieu of the tech industry. It lends itself very readily for us wanting leaders who are going to be able to make sense [of uncertainty].

“On the other hand, what is interesting is that the tech sector prides itself on being egalitarian and ‘flatter’. But then you think of Musk, and of Zuckerberg having 70% ownership and total control at Meta. What lends to people’s charisma is when we see them as prototypical of a culture and its values and how we want the collective to be.  

“So, to the extent that [the tech sector] is already being highly masculine, I think what you're seeing is the emergence of people who prototypically have already, and exemplify, the values of a lot of the people in that cultural space. On the one hand, there is a view of the tech industry as being highly egalitarian, but I also think there is a big masculinity part of it, and there is a nerd part.”

"Maybe that's why Elon Musk is not punished, because we know where he stands. His extreme opinions and behaviour don’t surprise us anymore"

Weber saw charisma as the possession of a particular type of authority that stemmed from admirers attributing extraordinary qualities to a single person. He said such leaders, whether they worked in politics or industry, appeared to have a “gift of grace” (from the Greek origins of the word ‘charisma’). To Weber, charisma depends on the “devotion to the specific and exceptional sanctity, heroism or exemplary character of an individual person, and of the normative patterns or order revealed or ordained by him.”

Today, even the language surrounding business leaders seems to have adopted evangelical overtones. Leaders across the corporate sphere no longer just talk about making money, but about vision and values. Between the complex threats of climate change, war and economic turbulence, a ‘saviour’ figure is an appealingly simple solution. When Musk soliloquises about saving humankind by colonising space and Bankman-Fried proposes the eradication of world poverty, they offer themselves as saviours to audiences beyond investors and employees. Back in 2002, Harvard academic Rakesh Khurana warned that the adulation enjoyed by some charismatic CEOs as “saviours” distracts us from other people’s contribution to a particular company’s success.  

When asked whether charisma is a quality that business leaders should aspire towards, Christian Stadler, professor of strategic management at Warwick Business School, is ambivalent. “I would say a more cautious approach is probably still better suited for organisations; however, Elon Musk does not do that. Does he do the share price of his companies any favours by being so outspoken? I tend to say no, but, on the other hand, [that behaviour] is exactly what creates his ‘following’. And maybe that's why Elon Musk is not punished, because we know where he stands. His extreme opinions and behaviour don’t surprise us anymore.”

On the dangers of charismatic figures, Misangyi thinks it is important to draw a distinction between charisma and narcissism. Despite similarities between the two concepts, in the corporate space, Misangyi believes they are differentiated in leadership roles. “Folks have argued for the positive sides of narcissism, such as the high levels of confidence, risk taking and visionary behaviours. But the problem with narcissism is in there the higher narcissism gets, the more it's about adulation that need for adulation. It's more about the self.

“Narcissists get promoted in the lower ranks of organisations. They are the ones who get promoted because they're willing to show confidence, but they're not the most effective leaders. And so, once they get to the top, they might be bad for organisations.”

The idea of ‘cult-like’ workplaces contrasts with popular headlines today, which regularly find fresh TikTok trends such as ‘quiet quitting’, ‘act your wage’ and ‘BareMinimumMondays’, which are all indicative of a mood far from blind fealty to an employer. Indeed, cults in which members opt to interact remotely and flinch at the suggestion of on-site days would seem to be of the less effective kind. “Today, people – young people in particular – expect to have a voice and to have an opinion,” says Stadler. “They do so every day on social media, so why should they switch off when they go into the workplace?

“I don't think every CEO is particularly happy about how this new world is progressing, where they can't just say how things should be done and expect people to follow.”

Misangyi observes that, by their hierarchical nature, workplaces traditionally lend themselves to the “hero worship” of individuals. “Are cults bad? Well, organisational culture is a cult and that is not necessarily a bad thing. We all think that's a great thing when organisations have strong cultures, because when everybody's internalised the values and the purpose and the mission, we can afford a great deal of autonomy.

“But to the extent that leaders use that charismatic power to actually get followers to be committed to themselves and to the leader over the collective, then that, to me, is the definition of corruption.”