Humor, a fundamental managerial tool, can be a double-edged sword for CEOs. As figureheads of their organizations, executives are scrutinized by industry observers, and the type of humor they levy can impact the company’s reputation.
Cecily Cooper, a professor in the University of Miami Patti and Allan Herbert Business School’s Department of Management, has studied humor and trust as critical organizational behaviors for more than two decades. She was a co-author on a recent paper that examined how four different types of humor used by executive-level leaders—affiliative/friendly, self-enhancing/coping, self-deprecating, and aggressive—produced varying outcomes.
“Using humor to be friendly (affiliative humor) or trying to put yourself above difficult circumstances (self-enhancing) are fundamentally beneficial for the outcome of organizational reputation,” Cooper said. “This is positive, enjoyable humor that makes people feel good, induces positive emotion, and doesn’t harm anyone.”
These types of humor speak to the expectations that CEOs radiate optimism and diverge from conventions in a good way, she noted. While these implications of friendly or coping humor might be expected, she highlighted that the proposed effects of other types of humor are not so straightforward.
Humor can be imagined in two different dimensions: the horizontal dynamic reflects the ability of humor to bring people closer together or push them apart; and the vertical dynamic reflects humor’s ability to be hierarchical, affecting perceived hierarchy and perceived status in a firm, Cooper explained.
“If the CEO is putting himself or herself down or pointing out a flaw that they have in a humorous way that reduces that hierarchical difference or perceived distance from that leader,” she said. “We expect CEOs to demonstrate agency, which means we expect them to exude strength, be decisive, and appear powerful. So, if they acknowledge their flaws, even in a humorous way, it contradicts expectations that we have of them to appear strong and powerful.”
How this contradiction and other perceptions of CEOs spill over and are parlayed through the industry is the work of infomediaries.
These professional third-party observers, such as journalists and analysts, play a key role in determining external stakeholders’ perceptions of a firm and influencing an organization’s reputation. Infomediaries stay informed by attending events such as quarterly earnings calls to monitor how the firm is doing. Based on these observations, infomediaries then publish articles in the business press and/or create reports that influence investment actions, such as stock trades, Cooper explained.
CEO communications are followed closely by infomediaries since CEOs are seen as the face of the organization.
“CEOs are the figureheads of the firms and self-deprecating humor is contrary to the way we expect these executives to behave,” she said.
Cooper noted that while there’s not much research on aggressive humor—teasing or belittling someone, putting them down—and while this type of humor is generally regarded as toxic, when used by CEOs, it can actually heighten organizational reputation.
“When you think about CEOs and the expectation that they exude strength and agency, to belittle a competitor can be seen in a very positive light, because they’re demonstrating that competitiveness and will to win,” Cooper noted.
In other research, Cooper has studied humor when used at other levels of a company—by front-line supervisors and mid-level managers—and found polar opposite results.
“Self-deprecating humor within the firm is actually really good to use for the same reason—because it decreases the salience of that hierarchical difference, the perceived difference, and it can make employees feel that they’re closer to the manager and improve their relationship,” she said. “But you have to remember that there’s not the same role expectations. As a front-line manager, you’re trying to build close relationships with those who you’re directly overseeing.”
Aggressive humor when used by front-line or mid-level leaders would generally have ostracizing and negative results, Cooper noted.
