Purpose

This study examines the complex relationship between executive overconfidence and firm performance, highlighting the moderating role of country-level factors. By conducting a meta-analysis of 116 independent effect sizes from global studies, this research aims to clarify the ambiguous effects of executive overconfidence, emphasizing the significance of national contexts.

Design/methodology/approach

Utilizing a cross-national meta-analytic framework, this study evaluates how variations in governance, board efficacy and shareholder protection across countries influence the impact of executive overconfidence on firm performance.

Findings

Results reveal that the relationship between executive overconfidence and performance is significantly shaped by country-level factors, suggesting a need to consider contextual influences alongside traditional trait-focused perspectives and underscoring the importance of contextual influences.

Practical implications

The findings suggest that organizations should incorporate national-level contextual factors in their governance structures to better manage the risks associated with executive overconfidence.

Originality/value

This study advances the literature by providing a comprehensive analysis of how country-specific variables modulate the effects of executive overconfidence on firm outcomes. It offers new insights into the role of situational factors in executive behavior, contributing to a more nuanced understanding of leadership and organizational performance.