Study Finds Corporate Psychopaths and Sociopaths Run the Banking Industry

by Robert Wilkinson

A study done on the global financial crisis finds that "highly-placed psychopaths in the banking sector may have nearly brought down the world economy through their own inherent inability to care about the consequences of their actions." Sounds about right to me!

This article was sent to me by a friend of the site. Written by Mitchell Anderson for The Tyee, it's titled "Time to Test Corporate Leaders to Weed out Psychopaths." With a byline "One per cent of humans: Not murderously insane, just devoid of empathy and ultimately destructive," we read of a study where a business professor has concluded that "Shark-like, they rise fast but risk killing the world economy."

By all means read the entire fascinating and confirmatory article, since it is a pioneering attempt to demonstrate we really should be doing psychological testing on our "leaders" to make sure that at the very least they're not completely crazed sociopaths.

To whet your appetite, here's a few choice pieces from the article:

Given the state of the global economy, it might not surprise you to learn that psychopaths may be controlling the world. Not violent criminals, but corporate psychopaths who nonetheless have a genetically-inherited biochemical condition that prevents them from feeling normal human empathy.

Scientific research is revealing that 21st century financial institutions with a high rate of turnover and expanding global power have become highly attractive to psychopathic individuals to enrich themselves at the expense of others, and the companies they work for.

A peer-reviewed theoretical paper from 2011 titled "The Corporate Psychopaths Theory of the Global Financial Crisis" details how highly-placed psychopaths in the banking sector may have nearly brought down the world economy through their own inherent inability to care about the consequences of their actions....

If true, this also means the astronomically expensive public bailouts will not solve the problem since many of the morally impaired individuals who caused this mess likely remain in positions of power. Worse, they may be the same people advising governments on how to resolve this crisis....

Psychopathy should not be confused with insanity. It is best described by Robert Hare, global expert and psychologist, as "emotional deafness" -- a biochemical inability to experience normal feelings of empathy for others.

This shark-like fixation on self-interest means that psychopaths often feel a clear detachment from other people, viewing them more as sheep to be preyed upon than fellow humans to relate to....

Studies on twins have revealed that psychopathy shows a strong genetic signature and there remains no effective treatment. Recent research has linked the condition to physical abnormalities in the amygdala region of the brain.

Only a small subset of psychopaths become the violent criminals so often fictionalized in film. Most simply seek to blend in and conceal their difference in order to more effectively manipulate others. This frightening condition has existed throughout human history, though likely in a marginal and socially parasitic way....

The human ability to build social capital means that people can co-operate and trust each other. We can reliably predict the behaviour of others even if we have never met them. Social capital is the glue that holds together our communities, complex societies, large institutions and the economy. The one and only superpower possessed by psychopaths is their ruthless ability to spend the social capital created by others.

Scientists believe about one per cent of the general population is psychopathic, meaning there are more than three million moral monsters amongst normal United States citizens. There is emerging evidence that this frequency increases within the upper management of modern corporations. This is not surprising since personal ruthlessness and fixation on personal power have become seen as strong assets to large publicly traded corporations (which some authors believe have also become psychopathic).

However, appearance and performance are two different things. While psychopaths are often outwardly charming and excellent self-promoters, they are also typically terrible managers, bullying co-workers and creating chaos to conceal their behaviour.

When employed in senior levels, their pathology also means they are biochemically incapable of something they are legally required to do: act in good faith on behalf of other people. The banking and corporate sector is built on the ancient principle of fiduciary duty -- a legal obligation to act in the best interest of those whose money or property you are entrusted with. Asking a psychopath to do that is like recruiting a pyromaniac to be a firefighter.

The folly of mixing psychopathy and senior corporate management has been borne out by recent history. At the end of the last decade, numerous banking institutions representing hundreds of years of corporate financial stability ceased to exist within a few short months due to the reckless acts of a few individuals -- none of whom have ever been charged with a crime....

Boddy is not hopeful that the current round of expensive public bailouts will solve the problem. If psychopaths have in fact installed themselves in the upper reaches of the world's financial institutions, their genetic deficiency dictates that their greed knows no bounds. They will continue to act in antisocial, remorseless ways, amplified by their enormous corporate influence until the institutions they represent and perhaps the entire global economy collapses. Obviously, more academic research in this area is urgently needed.

Boddy concludes his recent paper with this grim prediction:

"Writing in 2005, this author... predicted that the rise of Corporate Psychopaths was a recipe for corporate and societal disaster. This disaster has now happened and is still happening. Across the western world, the symptoms of the financial crisis are now being treated. However, this treatment of the symptoms will have little effect because the root cause is not being addressed. The very same Corporate Psychopaths, who probably caused the crisis by their self-seeking greed and avarice, are now advising governments on how to get out of the crisis. That this involves paying themselves vast bonuses in the midst of financial hardship for many millions of others is symptomatic of the problem. Further, if (this theory is correct) then we are now far from the end of the crisis. Indeed, it is only the end of the beginning. Perhaps more than ever before, the world needs corporate leaders with a conscience.... Measures exist to identify Corporate Psychopaths. Perhaps it is time to use them."

While I'm not usually big on testing, since they are easily used for manipulation of "who is right/who is wrong," it still seems like a good idea to find some way of weeding out psychopaths and sociopaths from the financial industry, since of all the industries, they are the only one that has absolute power over our lives (if we use money, want shelter, or consume products.) By all means take a look at the entire article (link here if you don't want to go back to the top) since there is a lot more I didn't reprint in this post.

Just another manifestation of The Grand Irrationality!

© Copyright 2011 Robert Wilkinson

Comments

[Beth Bridgman]

Robert, They already DO test everyone in business and governmental systems to see if they will just "follow orders" or "follow their conscience." The market collapse was not an error. It was a pre-arranged event that has been repeated throughout history. It is, of course, the culmination of our collective karmic debt that we would be under the thumb of many of these types of people all across the global leadership spectrum. When we return to "Love thy neighbor as thyself" and remove 3rd party involvement and remove all interest-bearing financial applications, we would have a world and economy worth preserving. Til then, may the fraudulent system be dismantled so we might have our Year of Jubilee.

[Beth Bridgman]

I should note that as this testing has been in place for quite some time, most folks are promoted by the very fact they will "just follow orders."

[caliban]

Hmmm . . . what gen ed class was it? Probably psychology where it was taught that we need those kind of psychopaths to make the really "tough and important" corporate decisions. Oh no, it was a program on the brain on public television, a lecture, university of the air, out of UW Madison. It has to do with the front of the brain, I believe. Titled, titled . . . something about the brain and the mind.

[caliban]

Got it . . . for what it's worth . . .

http://wptschedule.org/episodes/4012/University-Place/How-the-Brain-Makes-up-the-Mind/

[rogue12]

In essence the soul has died within these individuals, these "psychopaths." They have no sense of responsibility because they are so distant and removed from the things that they have power over, which is not in alignment with the way it is supposed to be. I don't think this is the way the world was meant to be lived, and if the ones who are responsible create these moral and material imbalances then time will move faster toward a change against this nature, because the ones who have a soul outnumber that 1%, and balance will be provided.

[john gibbs]

There was a documentary that came out in 2003 titled "The Corporation" which compares the behavior of the typical corporation the DSM-IV diagnosis of psychopath. [c.f. http://en.wikipedia.org/wiki/The_Corporation_(film) ] The guy who made the film also wrote a book titled "The Corporation: The Pathological Pursuit of Profit and Power." Unfortunately, there are structural reasons for this having to do with pressures set up by making return on investment everything. It is a small step from that to there being a real advantage for corporations to hire psychopaths.

[ull]

Well if you look around you will find psychopaths in high positions. People do follow them and often act like sheep..

[dcu]

Great post, Robert. I linked it to my local "occupy" peeps. Last Monday we showed the documentary "Inside Job" at a theater here in Rapid City, South Dakota. Given that this area is overwhelmingly Red State we were very pleased that 193 people came out to watch the film. It is an excellent piece and is narrated by Matt Damon. It won an Oscar for best documentary. Check it out. It explains nicely how the 2008 crash was not an accident and that the inmates continue to run the asylum. Strange Days.