Why Don't Business Leaders Assassinate Competitors?

Billions of dollars are at stake in the global market, and cutthroat competition often crosses the line into illegality. Corporate espionage is commonplace.

But why stop at stealing your competitor’s ideas? It’s relatively easy to hire an assassin, and research shows that the death of a CEO can cause marked decline in profits. So, the Overcoming Bias blog asks a good question: Why don’t more business leaders have each other assassinated?

Is it for the same reason that international custom expressly prohibits political assassinations?

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  1. Jared says:

    Let’s also not forget that international (or even simply domestic) business is NOT a zero sum game. Causing the death of one of your competitors’ CEO (and the ensuing stock price drop) might hurt that particular company, but there is no guarantee that their loss will translate into gains for your company. This is true even in a system where there is only one other competitor. It doesn’t make sense to spend your own capital, even at the cut-rates that hit-men seem to be advertising at for no guaranteed returns on that investment.

    A real world example of this would be sabotaging the gasoline of a single race car in a NASCAR race. Sure, you’ll hurt that particular car’s chance of doing well in that particular race, but it won’t make your own car run any faster, there are dozens of other drivers to race against still, and there are likely dozens of races in a season. It also lowers the potential level of competition, reducing interest in the sport as a whole, possibly diminishing future investments for your own race team.

    Granted, assassinating NASCAR drivers would probably make me start watching that sport, so who knows.

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  2. Richard says:

    Most companies would not benefit that much from short term disruption caused sabotaging a competitor, through assassination or otherwise.

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  3. tracy says:

    I suppose in really desperate times, maybe. But how desperate can you be?

    But for otherwise normal days, hiring assassins is like opening the floodgates of no holds barred competition. Once you’ve killed someone, you probably wouldn’t mind destroying the competition’s computer data systems, killing high-ranking employees (after the first one, marginal costs of the next few aren’t that much probably), committing arson to their office building/s, etc. Sure, businesses shouldn’t be tightly regulated to remain competitive, but I’m confident we can draw the line to exclude the above.

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  4. frankenduf says:

    this post is kinda ironic in lieu of the drastic damage that CEO financiers have done to their corporations leading to this recession- Merrill-Lynch lost billions under its CEO before giving him an xtra 120 million to leave- so now the strategy would be to handcuff the CEO to the board table in order to bring complete ruin to the corporation

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  5. Dave says:

    Would it not make more sense for a Board to authorize the assasination of their own CEO, rather than the CEO of another corp? This could save on the golden parachute costs, could get them a new CEO without having to admit a hiring mistake. As noted above, these benefits would flow primarily to the board rather than diffusely to all competitors.

    Also – surely there is a MacBeth like tale out there of some CFO offing the CEO to get access to the big office. Shakespeare is too accurate for this to have never happened!

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  6. Christopher W. says:

    Another factor: The average CEO’s tenure is measured in years, not decades. They may not identify with the company enough to indulge in the risks outlined above.

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  7. Winston says:

    The linked study says that CEO deaths “are strongly correlated with declines in firm operating profitability, investment and sales growth.” None of these offers immediate benefit to competitors.

    The first two are really internal matters — the company is not as efficient, but that doesn’t mean that it isn’t just as successful against the competition’s products. In the long term, these things might benefit the competitor. Then again, they might not.

    “Reduced sales growth” does not mean fewer sales, but that sales are increasing at a slower rate than they had been increasing. Again, in the long term, this might open up an opportunity for the competitor but there’s really no certainty that the competition will benefit — much less a specific competitor.

    What the competition really wants is to take market share away and that’s not what’s happening here. The small benefits that this paper suggest result from the death of a CEO could be achieved many other ways, probably with a greater degree of certainty.

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  8. Don says:

    the paper cited on the influence of deaths of CEOs does not reflect death by murder, so these may have two different effects in terms of publicity.

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