A recent study from Ohio State University reveals a compelling link between the personal credit scores of top-level corporate executives and their decision-making behaviour in high-stakes business environments. The research suggests that credit scores—traditionally viewed as mere indicators of personal financial responsibility—may also serve as proxies for how executives process risk and respond to external advice. In particular, executives with prime credit ratings (typically defined as FICO scores of 660 or above) were found to make more thoughtful, independent decisions, especially in situations requiring critical evaluation of uncertain outcomes. By contrast, those with subprime credit scores were more likely to act as “yes persons”, deferring to consensus or advice from others even when it contradicted their own experience.

The study, led by Associate Professor Noah Dormady and doctoral researcher Yiseon Choi of Ohio State’s John Glenn College of Public Affairs, was recently published in the International Journal of Production Economics. It involved a controlled behavioural experiment with 303 C-suite executives holding high-ranking roles such as CEO, CFO, or COO at middle-market firms with annual revenues between $10 million and $1 billion. Participants self-reported their FICO credit score and engaged in a decision-making simulation that tested their responses to investment recommendations amid hypothetical disaster scenarios. The simulation required executives to decide whether to stockpile inventory that could be a buffer in a production-halting catastrophe, such as a hurricane.

The experiment consisted of ten decision-making periods for each participant, with two rounds each. After the first round of decisions, executives were given a unanimous recommendation from a simulated advisory group—appointed by their fictional CEO—to either invest in or refrain from stockpiling. Participants then made a second decision and were subsequently told whether a catastrophe had occurred, with a 25% chance of such an event per round. The researchers observed how the executives responded to this information over time, particularly how they balanced prior outcomes with advisory input.

Findings revealed that executives with high credit scores were far more likely to treat external advice as one piece of a broader evidentiary puzzle, integrating it only when it aligned with their own scenario experience. For example, if a catastrophe had occurred in previous rounds, they were more inclined to heed advice to stockpile inventory. However, they did not hesitate to reject advisory input when it seemed ill-suited to the facts. This pattern suggests more substantial autonomy and confidence in decision-making, possibly rooted in a personal history of sound financial judgement.

In contrast, executives with subprime credit scores were nearly twice as likely to accept the advisers’ recommendations wholesale—even when the advice was misleading or ran contrary to what their own experience in the simulation should have indicated. Dormady remarked that such executives appeared to prioritise consensus over critical analysis, a tendency that could impair a company’s ability to adapt swiftly and appropriately to volatile conditions. Choi added that this pattern may reflect deeper behavioural tendencies, whereby poor financial decisions in one’s personal life echo a broader difficulty with risk evaluation in professional contexts. While the study controlled for demographic variables such as gender, income, and veteran status, the FICO score most reliably predicted the nature of the decision-making behaviour.

Despite the strong correlation uncovered, Dormady cautioned against using credit scores as a screening tool for executive recruitment. “There are serious ethical considerations to account for,” he said, noting the potential for discrimination or misuse of personal financial data. The authors advocate for additional replication studies to validate the findings before any practical application is considered. Still, the research opens new avenues for understanding how personal psychology and financial behaviour may inform leadership styles. It challenges conventional thinking about what makes a good executive. It suggests that objective, evidence-based reasoning may, in part, be forecast by the seemingly unrelated credit score metric.

More information: Noah Dormady et al, Can FICO Scores Be Used to Explain Managerial Decision making?:Evidence from a Supply-chain Resilience Experiment, International Journal of Production Economics. DOI: 10.1016/j.ijpe.2025.109675

Journal information: International Journal of Production Economics Provided by Ohio State University