Today’s reality is that most businesses, large or small, will face a crisis at some stage of their life cycle. Increasing interconnections in social, economic and political systems make us more vulnerable to crises. Our growing dependence on technology exposes us to risks such as disinformation, ransomware, malware, and data leaks. Globally intertwined supply chains have made us more susceptible to crises brought about by geopolitical tensions and war. Whatever the case, when a business anticipates and responds to crises brought about by disruptions in supply chains, geopolitical upheavals, economic instability, climate change or cybercrime, it is better prepared to survive. A leader who can manage a crisis effectively has the skills to navigate uncertainty, take decisive actions, and communicate effectively and with empathy. However, one thing can derail any dedicated efforts to enhance crisis preparedness and improve response effectiveness when it counts the most. An unchecked ego can play havoc on crisis leadership: the kind that can make or break a crisis.
A few years ago, the Harvard Business Review published an article highlighting how leaders risk getting an inflated ego if they isolate themselves from their colleagues, workplace culture and even clients. A leader’s big ego can pose a huge problem in the workplace, clouding their judgement and making them oblivious to their weaknesses and flaws. Failure to listen, accept constructive feedback or be open to different points of view can hinder the most intelligent and talented leaders. While leadership might come with power, more money, a fancier office and people who hang onto your every word, it also comes with the danger that impacts the ability to lead successfully, especially in a crisis. Power can inflate the ego, leading to corrupt behaviour, judgement and morality.
The collapse of the Fortis bank and insurance group during 2008 and 2009 provided a powerful case study demonstrating the downside of big egos. Acquisition activities driven by inflated CEO and Chairman egos played a decisive role in the company’s demise during the global economic crisis. The quest to become one of the most important European financial organisations provided a stage for ego, power, tactical games and politics in the actions of top executives on critical and timely issues. In October 2007, Fortis formed a consortium with the Royal Bank of Scotland and Banco Santander to take over ABN AMRO. The combination of a high takeover price and the severe global credit crisis confronted Fortis with serious problems, ending in an acute liquidity crisis in mid-2008. In early October 2008, the Belgian and Dutch governments stepped in to nationalise the bank to prevent it from going under. The case highlights how ego played a role in compromising the CEO’s logic during a takeover. It also points out how previous acquisition experiences boosted his self-esteem, resulting in overconfidence and leading to riskier behaviours.
The press was also identified as a factor in massaging the ego of board members and CEOs, giving scant attention to social responsibility issues such as accountability to bank customers and employees.
Ego was on the centre stage of the crisis that evolved after the former Spanish football federation president, Luis Rubiales, planted a controversial kiss on star footballer Jenni Hermoso at the Women’s World Cup Final in 2023. She later said the kiss was non-consensual. Even as public fury grew over Rubiales’ actions and the Spanish Football Federation’s (RFEF) perceived tolerance of sexism within the organisation, the federation was slow to respond. It appeared not to comprehend the gravity of what happened and initially dismissed the crisis and supported Rubiales. A week after the controversial event, the RFEF changed tactics, announcing an “extraordinary and urgent” meeting in Madrid with the heads of Spain’s 19 regional football federations to assess the impact of the crisis.
Meanwhile, Rubiales, whose first response to the public outcry over the kiss was that his critics were ‘idiots and stupid people,’ was forced to apologise the day after Spain’s World Cup win, saying he was “completely wrong.” Many deemed his words a non-apology, “I have to apologise, learn from this, and understand that when you are president, you have to be more careful.” In a subsequent apology, a week later, he said his behaviour “seems like it has caused a commotion.” This tone-deaf response, too, garnered criticism for obvious reasons.
In the following days, while public protests continued, coaching staff resigned, condemning Rubiales’ conduct. As well as spotlighting sexism, his behaviour drew global attention to deep dysfunction at the Spanish football federation. The international governing body of association football, FIFA, removed Rubiales from office with a 90-day suspension, citing the risk of witness tampering by the president and his allies as a justification. Three weeks after Spain’s win, Rubiales folded under immense pressure and resigned from his position, which he had held since 2018. In late October, FIFA banned him from the sport for three years for misconduct at the Women’s World Cup final.
In July 2019, party members elected Boris Johnson as Conservative Party leader, and he became Prime Minster after Theresa May resigned. He then won the December 12 general election, aided by the promise to ‘get Brexit done.’ However, scandals and poor decision-making marred his leadership. Amid the Brexit discussions in late August 2019, he shut down Parliament until mid-October, giving his political opponents even less time to block a no-deal Brexit before the October 31 withdrawal deadline. The move set off a crisis as the pound plunged on the news amid concerns about the potential impact on Britain’s economy. His critics were outraged. UK’s Supreme Court subsequently ruled that the government’s suspension of Parliament was unlawful.
Johnson’s leadership was subject to many questions about how he handled the pandemic, the Partygate scandal and other ethics violations. He defied the COVID rules during the lockdowns, seeing his friends and relatives while the rest of the country was restricted in their daily movements and expected to follow the strict measures. At one stage, he was fined £50 for attending a lockdown party and then apologized, insisting that he didn’t know he was breaking the rules. His behaviour caused damage and division within the Tories, as support for him within the party and the country dwindled. As top aides quit and he narrowly won a vote of no confidence, with 41% of Conservative lawmakers voting against him, his grip on power continued to weaken. On July 6, 2022, after two of his most senior Cabinet ministers quit, followed by dozens of government resignations protesting his leadership, Johnson resigned as Conservative Party leader. He remained Prime Minister until Liz Truss replaced him on September 6. Her tenure was short-lived amid the boiling dissension within the Tories. In June of the following year, Johnson resigned as a member of Parliament after he received a report investigating whether he lied to Parliament about gatherings he and some of his staff attended while the rest of the country was in lockdown. He left his party in tatters.
Elon Musk forged a market for the electric car when he launched Tesla, upending the automotive sector and revolutionizing the transport industry. He disrupted aerospace when he started SpaceX to revolutionise the industry and make affordable spaceflight a reality. While these businesses were sometimes on the verge of collapse, his determination, bold ambitions and disruptive approach have shown him to be a divisive figure with a sizeable ego. A biography by Walter Isaacson published in 2023 makes it clear that Musk doesn’t like pushback and resistance, qualities that don’t bode well for leaders, especially those who are dealing with a crisis. Reports of Musk’s ego have long provided fodder for the press and social media.
Musk’s takeover of Twitter set off a rollercoaster ride, sowing chaos with his ego on full display. He dramatically reduced the workforce, eliminating more than 70 percent of staff including cutting teams responsible for keeping the platform safe. The first sign that layoffs were impending was when some employees discovered they could not log into their corporate email accounts and laptops. Advertisers deserted Twitter as hate speech flourished after Musk overhauled practices and welcomed back formerly barred accounts such as Trump’s, who was banned because his tweets could be seen as inciting violence. He rebranded Twitter as X, abandoning 17 years of brand awareness as the platform, which once aspired to be a global town square, morphed into a hardcore, controversial space that allows misinformation and disinformation to spread. The verification badges, including those of vetted journalists, were eliminated as he started to sell them while also paying creators for views through the revenue-sharing program, providing a fertile ground for misinformation. As of the beginning of 2024, the social media platform has lost 71 percent of its value since Elon Musk bought it for US$44 billion in October 2022.
A healthy ego has helped to drive many success stories, but an over-inflated ego can be toxic. Bad decisions happen when ego takes over, and power, arrogance, cockiness and the belief of being ‘right’ are added to the mix. Furthermore, it boosts self-esteem by making those with large egos feel as if their beliefs are accurate, regardless of the circumstances. A leader who listens and is open to criticism, new perspectives, and information, is more approachable and able to make better decisions. Openness and collaboration also help build a stronger, more cohesive team while supporting an environment that fosters trust and respect, which serves well in a crisis. The impact of poor leadership in a crisis has far-reaching consequences. When those in positions of power and influence lead with their egos, there are serious repercussions. People suffer, investments crash, reputations are ruined, credibility is compromised and more. The price paid is not only in money.
Certain attributes are essential to lead effectively in uncertain, difficult or dangerous situations. Even the most experienced leaders can learn, develop and practice the competencies needed to survive and triumph over a crisis. Leaders who practice humility allow space for openness, trust and collaboration among their peers and employees, which will help provide support on the road to recovery. Ultimately, crisis leadership is about navigating the course through chaos and adversity and avoiding a reputation train wreck by sustaining stakeholder trust. It’s hard to do that when an oversized ego gets in the way.
Caroline Sapriel is Managing Partner of CS&A International, a consultancy specialising in risk, crisis, and business continuity management. With over 30 years of experience in risk and crisis management, she is recognised as a leader in her profession and acknowledged for her ability to provide customised, results-driven counsel and training at the highest level.