Explaining Performance in Annual Reports: Are American or Japanese Executives More Self-Serving?

Generally speaking, researchers have found that individuals use the self-serving attributional bias to maintain their psychological well-being and to manage impressions. Considering that the self-serving attributional bias has been shown by many classic social psychological studies to be fairly common, it may have also found its way into the executive suite. Reggy Hooghiemstra of the University of Groningen in the Netherlands addressed this topic in a recent study that compared how US and Japanese companies apply the self-serving attributional bias in explanations of their annual performance to shareholders. The results are compelling. The most surprising finding from Hooghiemstra's study is that Japanese executives showed an even stronger tendency than their American counterparts to attribute negative outcomes to external causes in shareholder letters.