Corporate governance models segregate the role of risk manager and risk taker to allow for independent challenge of risk-related decisions. Numerous studies have demonstrated that broad personality traits predict risk-related behaviour. While prospect theory revealed a natural preference towards risk-taking in a negative risk frame, studies have also shown the influence of personality traits on risk preference. We investigated the less reported subject of the potential influence of risk stakeholder personality on risk decision making in the corporate environment. We expected to observe that the personality traits of risk takers and risk managers will differ as a consequence of occupational self-selection. Further, we expected that such personality differences will produce disparate risk preferences between risk takers and risk managers, supporting the governance expectation of independent challenge of risk-related decisions. A sample of investment banking risk stakeholders (n = 100) completed the HEXACO–PI–R as well as a vignette-based risky choice questionnaire involving positively and negatively framed financial risk scenarios. We found homogeneity in personality traits between risk takers and risk managers but observed a noticeable bias toward risk-taking in the negative frame by risk managers. High Honesty–Humility and Conscientiousness scores in both groups may negate the risk of irresponsible risk-taking or undesirable risk behaviour. The results of this study confirm the importance of personality screening for job applicants and should also alert risk practitioners to potential weaknesses in the independent challenge of risk-related decisions as a result of personality homogeneity among risk stakeholders.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:nwu/oai:dspace.nwu.ac.za:10394/17046 |
| Date | January 2016 |
| Creators | Grobbelaar, Jan |
| Source Sets | South African National ETD Portal |
| Language | English |
| Detected Language | English |
| Type | Thesis |
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