The concept of CEO self interest forms a foundational assumption in economic theories of organizations. Agency theory argues that agent CEOs may act in self interested ways that harm the firm. By prescribing financial incentives that align an agent CEO’s interests with owners’ interests, self interested CEO will be more likely to act like owners. This paper challenges the assumption that agent CEOs should be induced to act like owners. From an employee-centric viewpoint, we argue that ownership concentration may actually heighten their perceptions of CEO self interest. Drawing on attribution and social learning theories, we argue that their perctions of CEO self interest shapes how employees engage with their organization. Using survey data from 550 organizations across 20 countries, we find that ownership concentration increases employees’ perceptions of CEO self interest. We also demonstrate that those perceptions are negatively related to employee willingness to sacrifice for their firms, which in turn harms organizational competitiveness. These findings challenge agency theory’s focus on ownership as a resolution to self interest conflicts.
