Another reason for why CEOs matter. Today's story in the WSJ focused on how investors are increasingly demanding CEO face time in order to get greater insights into the company's strategy and future and determine whether it is worth their investment to take a stake. One of the CEOs complained said that meeting with investors and analysts is taking up too much time. This should not come as such a surprise. The job of CEOs today is not to only run the business but be that communicator-in-chief with its portfolio of stakeholders which I grant is expanding by the year. The article seems to point out that these meetings are getting more granular than the larger-sized ones of years past and taking up more and more time. One CEO says he meets groups of 50 investors in batches, one after another, or in private 30 minute sessions. The article provides a few interesting stats on the pressure on CEOs to make time for investors...
- C-suite executives in North America attended 70% of private investor meetings over the past 12 months, up from 64% one year earlier.
- CEOs and finance chiefs spent 14 days and 17 days, respectively, on these meetings.
The article provides many different reasons for why meeting the CEO is important but one that wrapped it all up for me was when a president of Fidelity Investments said that meeting the CEO provided "nuances" about the company that does not come through in an earnings call and helped him "put the entire mosaic together." I thought that the "mosaic" idea was useful in understanding what role the CEO and his or her reputation does actually play. Although the CEO is just one part of the picture or mosaic in this case, the CEO's leadership, transparency and credibility helps glue together the partial perceptions of a company we all have and fit them into a pattern that yields a reputation. Getting to meet the CEO and gauge his or her character through the whites of his/her eyes is a critical piece to the puzzle of reputation that adds to a valuation about a firm's future performance. After all, isn't that part of the CEO job description today -- to balance the external and internal?