CEO cognitive complexity presents an intriguing juxtaposition in its effects on firm outcomes, particularly in the context of strategic outcomes such as the likelihood of product recalls. Recent studies contend that while CEOs with higher cognitive complexity can potentially improve firm outcomes (e.g., firm performance) due to their detailed and multifaceted information processing, these tendencies might also present challenges because of the extended time and energy they devote to decision-making, potentially overlooking immediate threats. Thus, recent studies have called for further investigation of particular outcomes that can be either improved or negatively influenced by CEO cognitive complexity. We propose and demonstrate a nuanced relationship between CEO cognitive complexity and product recalls, moderated by the CEO's past temporal focus. Specifically, CEO cognitive complexity decreases the likelihood of product recalls building on the literature on goal-oriented feedback and learning literature. We also build on the temporal focus theory and propose that such effect is more pronounced when CEOs have a higher past temporal focus, drawing from previous experiences and lessons. Post-hoc analyses further verify our findings. Our study underscores the importance of understanding the intricate interplay between a CEO's cognitive style and their historical perspective in predicting firm outcomes, particularly in the realm of product safety and recalls.
