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Clues to When CEOs and Politicans Are Lying to You

Three clues to when somebody is lying to you.

Living with your grandmother is a recipe for miscommunication. On a random Tuesday, when I was 15, a plan was being hatched to meet up with a few friends at the local 7-11 convenience store to eat a few hot dogs. Unbeknownst to me, my grandma was outside my room listening in to the phone conversation. To her defense, it would be hard for anyone to make sense of the whispers and jargon on my end. "Marc, do you think we can afford the stuff?" "Do we know if anyone else is going to be there?" "If this doesn't go down well, I'm going to have to sneak through the garage when I get home."

Upon leaving my bedroom, there was my grandmother blocking my path with arms folded across her chest. The first words out of her mouth were, "Todd, I need to talk to you. Look at me. Are you on drugs?" Essentially, this is what Selma deduced: 7-11 was for derelicts because skateboarders congregated there. Unless it was an illegal transaction, why would I refer to the planned purchase as "stuff"? My eyes were always bloodshot and this is a clear marker of drug use (as opposed to the hard contact lens that I never removed).

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Now let's be clear, Gene Hackman was in no danger of losing his job on the narcotics bureau in "The French Connection." Selma breathed heavily, walked with lead feet, and possessed a grandmotherly smell that will forever be endearing to me (but problematic in covert operations). But this incident raises the question of whether Selma could tell if I was lying....

I was reminded of these regular, bizarre interactions with my grandmother this morning. New research emerged at Stanford University on how to tell whether CEO's are lying. When Kenneth Lay shared news about the earning reports of Enron, did his selection of words offer insight into hidden lies and deceit? What about the phrasings of BP executives as they shared plans to financially compensate everyone who suffered from the oil spill?

While each of us has careful control over the story we want to tell, our true motives and feelings can "leak out" in our word use. Two researchers analyzed 29,663 conference calls by business executives from 2003 to 2007. Of particular interest were the narratives carefully sculpted by CEO's to tell the media and public about company performance and plans. These Stanford researchers found a few  interesting findings.

First, be wary of words that distance the speaker from personal ownership of what they are saying. Instead of first-person pronouns, the speeches of lying CEO's overflowed with plural words such as "we," "us," "team," and "group." You might be saying to yourself, that doesn't sound problematic, perhaps they are grateful of everyone in their organization. Remember, it only takes one or two references to make the point that you didn't attain success on your own. It is the lack of self-references that is linked with deception. If a person knows they are going to deceive you, the last thing they want to do is emphasize that they are the person to contact if things go wrong. Most speakers are consciously unaware of their avoidance of self-references.

Second, be wary of over-the-top glowing positive statements. The expression of positive emotions has a tipping point. Be skeptical when a CEO uses an excessive number of flowery terms to describe the future prospects of the company. Notice the intense positive emotional terms in speeches by Kenneth Lay, words such as fantastic, amazing, wonderful, and superb. If a CEO sounds like a hypomanic mother touting the artistic mastery of their two-year old doodler, there is reason to be afraid, very afraid.

Third, be wary of absolute certainty. This might be the most valuable take-home finding. Not surprisingly, we feel less anxious when leaders appear confident without any ambivalence about their decisions. The only problem is that few decisions are clear cut and none of us know what the future holds in terms of the economic and political climate. I only worry about people who claim they know what is going to happen. I worry about people that lack anxiety. CEO's that use an overabundance of words reflecting absolute confidence and a lack of words reflecting hesitation are more likely to be lying.

A speaker's linguistic style offers a portal into their motives. This research has powerful implications for understanding how little we know about other people, especially when we don't have the same access to information. I suspect that the findings would be the same if we focused on grandstanding politicians, media pundits, journalists, scientists, real estate agents, teachers, and anyone trying to sell you something, anything. Seriously, look at the three findings above and tell me that doesn't describe the last person trying to sell you a car.

There's nothing wrong with an assumption that people are inherently good while giving them the benefit of the doubt. All I ask is that you go beyond the surface content of what people talk about. Mindfully attend to how they speak and you might uncover something interesting, something terrifying, something that prevents you from being suckered. And if you don't want to be mindful, you now have three tips for how to lie better. Go ahead, feign a story about how great of an athlete you were in high school or how incredible you are at seducing strangers in bars. Perhaps you'll be lucky and your audience won't read this post and call you out.

For more about the research in this article, check out:

Larcker, D.F., & Zakolyukina, A.A. (2010). Detecting Deceptive Discussions in Conference Calls.

Dr. Todd B. Kashdan is a clinical psychologist and professor of psychology at George Mason University. He is the author of Curious? Discover the Missing Ingredient to a Fulfilling Life. For more about his talks and workshops, books, and research go to www.toddkashdan.com or the Laboratory for the Study of Social Anxiety, Character Strengths, and Related Phenomena

Todd B. Kashdan, Ph.D., is Professor of Psychology at George Mason University and author of The Upside of Your Dark Side: Why Being Your Whole Self–Not Just Your 'Good' Self–Drives Success and Fulfillment more...

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