The shadow of narcissism on CSR: unveiling hidden dynamics of financial performance within the SBF 120

Purpose This study explores the relationship between corporate social responsibility (CSR) performance and financial performance (FP) in French-listed companies, focusing on the moderating role of CEO narcissism. It aims to offer new insights into how CSR affects FP and how narcissistic leadership influences this link. Design/methodology/approach The analysis is based on a sample of 120 companies listed on the SBF 120 index between 2011 and 2022. The analysis combines generalized least squares regressions (for heteroscedasticity) and GMM (for endogeneity) with individual and sectoral fixed effects. Using generalized least squares (GLS) regression, the study assesses the direct effect of CSR on FP and examines how CEO narcissism moderates this relationship. CSR performance is proxied by ESG scores, while narcissism is measured through the prominence of CEO photographs in annual reports, along with other behavioral indicators. Findings The results show a positive association between CSR performance and financial performance. However, CEO narcissism negatively moderates this relationship, meaning that high levels of narcissism weaken the positive effect of CSR on FP. The findings also highlight the importance of board characteristics – including independence, size and director experience – in strengthening financial outcomes. Research limitations/implications This study focuses on nonfinancial firms in France, which may limit the generalizability of the results. Future research could extend the analysis to other cultural and industrial contexts. Also, the chosen methodology may not fully capture the complex interplay between CSR, narcissism and FP. Practical implications The findings suggest that firms should align CSR strategies with leadership traits, as narcissistic CEOs may reduce CSR’s financial benefits. Boards are encouraged to consider personality traits when making executive appointments and to reinforce sound corporate governance practices to support CSR effectiveness. Social implications The study underlines the growing importance of CSR in meeting stakeholder expectations and fostering long-term value. It also raises concerns about the potentially harmful influence of narcissistic leaders on social and environmental initiatives, reinforcing the need for ethical leadership and transparency. Originality/value This research enriches existing literature by introducing CEO narcissism as a moderating factor in the CSR–FP relationship. It provides empirical evidence that narcissism can diminish CSR’s positive financial effects, offering a more nuanced view of how leadership traits impact corporate outcomes. The study also proposes an integrated model connecting CSR, narcissism and FP, contributing to a deeper theoretical understanding.