[Portions of this appeared on the HBR blog]
CEO reputation is in need of yet another upgrade: let's call it CEO Version 7.0. We started out at the turn of the last century with the Industrialist CEO, moved on to the Organization Man, then to the Celebrity CEO, Dot Com CEO, Recession CEO, Smart Creative CEO and now, making an entrance, the seventh reincarnation of what it means to be a successful chief executive -- the “Engaging but Humble CEO.”
The Engaging but Humble CEO not only needs the skills that are historically attributed to highly regarded CEOs, such as adeptness with financials, but now must also embrace being publicly engaging while remaining modest, transparent, caring about others, collaborative and authentic. Let me explain why we know this.
The ever-evolving digital environment is a major reason for the emergence of CEO 7.0. As I’ve heard it said, Google is not a search engine, it is a reputation management system. We live in a tell-all, speed-of-light world, a world filled with so, so much information about you, me, everyone else and everything, including CEOs and their companies. If CEOs handle themselves online as well as offline with care, the digital world is a powerful accelerator for reputational success. If they don't, they and their companies are only an algorithm away from scandal.
At Weber Shandwick are thoroughly invested in the art and science of corporate reputation. Because one of the driving forces behind corporate reputation is CEO reputation, we are invested in exploring how CEOs are perceived in this Internet Century. We conducted new research online with KRC Research, The CEO Reputation Premium: Gaining Advantage in the Engagement Era, among more than 1,750 executives in 19 markets worldwide. We sought out the perspectives of those closest to the CEO, those in the best position to judge. In a perfect world, we'd love to know what CEOs think too. Here are our most noteworthy findings:
1. The Engaging but Humble CEO has a competitive edge. CEOs are not known for being wallflowers. Yet, one in four are described in our study as being humble. This is a nascent trend that will undoubtedly continue to grow. Global media coverage of humble CEOs has spiked 200% in the past year and mentions have risen 70% in a Google search. In our survey, highly regarded CEOs are nearly six times as likely as less highly regarded CEOs to be described as humble by their executives (34% vs. 6%, respectively). CEOs today have to demonstrate their humility, not their celebrity, and make it clear that the company, not themselves, is their focus.
Engaging but Humble CEOs should never be underestimated for they motivate and empower those around them, share employees’ values and listen well. They use their reputations on behalf of all. They rely on their senior teams to validate strategy. They build cultures that are about the collective whole, not individual rising stars.
2. The Engaging but Humble CEO is publicly visible. A hefty 81% of global executives believe that for a company to be highly regarded it is important for CEOs to have a visible public profile. In addition, admired CEOs are four times more likely to be skilled at engaging the public than those with less admired status (50% vs. 13%, respectively). When engaging the public, CEOs are the purveyors of the company's narrative. It is this narrative that must stand out amidst the informational deluge that besets the public. The Engaging but Humble CEO therefore must attend to the clarion call, standing up and standing out so as to tell the company's story. Given the glut of competing information bombarding society, however, standing up and standing out is no easy task. It is immensely difficult to get the story of one’s company not only heard, but also recalled and shared. All of which leads to our next finding.
3. CEO story-telling needs to be carefully cultivated, calibrated and meaningful. The CEO must convey the company narrative and satisfy the marketplace's demand for content and transparency by using both traditional methods and newly developed digital channels to engage stakeholders. Which of the many communications channels are mission critical? The majority of global executives (82%) believe speaking engagements to be most beneficial when engaging external stakeholders. Industry-specific speaking engagements are more important than non-industry ones. Other important external CEO activities are building relationships with the media, using the company website strategically, and identifying compelling thought leadership platforms. Social media participation is also viewed favorably. A full 43% of respondents deem using social media as a worthwhile CEO activity to demonstrate the company’s forward-looking ideas and clear vision for the future and, of course, to elucidate the company story.
Along with public visibility and engagement, however, comes some risk. When asked whether CEO visibility positively or negatively impacts company reputation overall, an equal number said it improves reputation (41%) as said it can either improve or harm reputation (41%). Yet, only 10% said visibility serves only to harm a company’s reputation. The smart Engaging but Humble CEO takes advantage of the positives but is wary of the negatives. Such a CEO prepares carefully before going visible and standing out.
4. CEO reputation is a human capital magnet. The Engaging but Humble CEO’s good reputation is also a significant advantage in today’s raging battle for talent. Global executives say that a positive CEO reputation attracts new employees (77%) and helps to retain them (70%). This is true even of the nomadic Millennial who is expected to have a startling 15 to 20 jobs during a lifetime. Cultivating a strong CEO reputation can do much to make the Millennial grow roots and become less itinerant, thereby contributing to a company's stability and enduring success.
5. CEO reputation is as fundamental as ever to corporate reputation. Nearly one half of a company’s corporate reputation (45%) is attributable to its CEO’s reputation. Similarly, 44% of a company’s market value is attributable to the reputation of the chief executive. Tellingly, one-half (50%) of the global executives we surveyed report that they expect CEO reputation to matter even more over the next few years. Thus the enterprising CEO – and the Engaging but Humble CEO even more so – can still expect to contribute substantially to the improvement of a company’s reputation now and into the future.
Global executives today are luckier than ever -- in fact, CEO 7.0, the Engaging but Humble CEO, never had it so well. A rich ecosystem of channels exists to promote the company’s business strategy, greater purpose and company story. Customers are ready to engage with the CEO, and conferences with receptive audiences are exploding.
CEOs now generally accept what has long been apparent. Like it or not, they are public figures. By virtue of digital communications we all have in some sense or another gone public. It is just that some of us, CEOs in particular, are more public than others. There is no turning back. It’s time to embrace engagement but in a most humble way.