The Charismatic Leader’s Edge: A Literature Review on CEO Extraversion and its Impact on Financial Performance

CEO personality traits, particularly extraversion, have garnered increasing attention for their potential influence on organizational outcomes, yet existing research offers fragmented insights into how this trait specifically affects financial performance. This study aims to synthesize and critically evaluate the literature on CEO extraversion and its relationship with firm financial outcomes. Employing a narrative review methodology, data were collected from the Scopus database using targeted search strings to identify relevant peer-reviewed articles. The analysis integrated theoretical perspectives from Upper Echelons Theory and Trait Activation Theory to explain how CEO extraversion influences strategic decision-making, stakeholder engagement, and performance under varying environmental conditions. Key findings suggest that extraverted CEOs tend to enhance firm performance through assertiveness, optimism, and communication, although such traits may also lead to excessive risk-taking during periods of uncertainty. The study contributes theoretically by bridging psychological traits and strategic outcomes, and practically by guiding boards in executive selection and governance practices. These insights provide a foundation for future empirical research to further examine personality-performance dynamics across industries and cultural contexts.