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Student sits at her desk and looks at the laptop. © Aliona Kardash​/​TU Dortmund

Publication in Academy of Management Discoveries

Picture of "Multi-CEOs: A Legitimacy Perspective on Executives Leading Multiple Firms" in the journal Academy of Management Discoveries (AMD) © Academy of Management
It is hard to imagine that a CEO can manage more than one company well at the same time - so how do "multi-CEOs" explain themselves to their stakeholders?

In a new study published in the journal Academy of Management Discoveries, researchers from TU Dortmund University and HEC Lausanne investigated a surprising but important phenomenon in the corporate world: "multi-CEOs", i.e. CEOs who run several independent companies at the same time.

Given the multiple roles of CEOs and the fact that the CEO has overall responsibility for the success of a company, it must seem unwise or illegitimate to investors and other stakeholders to have one person running several companies at the same time. Constantine Alexandrakis, CEO of executive search firm Russell Reynolds Associates, once put it this way: "Managing a single company should take up 150% of a CEO's attention".

The study examines the careers of four prominent multi-CEOs: Elon Musk (Tesla and SpaceX), Carlos Ghosn (Renault and Nissan), Jack Dorsey (Twitter and Square) and Steve Jobs (Apple and Pixar). It shows how multi-CEOs and allied actors such as boards of directors carefully manage the legitimacy of a multi-CEO arrangement in various ways.

For example, they often publicly admit that a multi-CEO arrangement is not desirable, but at the same time suggest that it is inevitable in their specific situation. The companies often conduct a full CEO search process-and discuss it publicly-which lends legitimacy to the end result of a multi-CEO arrangement. "Multi-CEOs also often talk about how much work it is to run two companies, which makes stakeholders feel good that their concerns are being taken seriously. At the same time, however, multi-CEOs claim that their job is quite achievable, for example because they have excellent teams supporting them. In particular, they often have Chief Operating Officers who take the workload off them. Elon Musk, for example, has Gwynne Shotwell, who virtually runs SpaceX for him," says Lorenz Graf-Vlachy, professor at TU Dortmund University and one of the authors.

In addition, multi-CEOs often conclude symbolic remuneration agreements. Graf-Vlachy explains: "Steve Jobs only received a salary of 1$ from Apple. But he owned a lot of shares, which gave investors the certainty that he would only make money if they did." Multi-CEOs also consciously divide their time between company headquarters, whether it's running back and forth between them every day, like Dorsey between Twitter and Square in San Francisco, or spending their weeks between Paris and Tokyo, like Carlos Ghosn did for Renault and Nissan. Multi-CEOs also try to dispel the impression of conflicts of interest, for example by claiming to recuse themselves from decisions that might affect both their companies, or by articulating explicit decision-making rules.

Graf-Vlachy adds that "the study improves our understanding of how multi-CEOs get into their positions and how they get away with it". The study thus sheds light on the phenomenon of multi-CEOs and sensitizes stakeholders to their strategies.

The full text of the study can be found here.

Graf-Vlachy, L., Hensellek, S., & Haack, P. 2024. Multi-CEOs: A Legitimacy Perspective on Executives Leading Multiple Firms, Academy of Management Discoveries, online first.

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