CEO Premiums

October 10, 2007

CEO Premiums

talkhotseat2.gifHave to apologize for my lack of blog postings over the past few weeks. I have been traveling and working a lot and finding it hard to muse over reputation. But hope to get the juices flowing again.  Last Sunday’s New York Times article by Eric Dash and Landon Thomas Jr. on the pressure facing Citigroup CEO Chuck Prince had a few illuminating comments on the “CEO premium.” This is what my friend and fellow CEO watcher Carol Ballock always calls it.  Apparently the media is speculating about the length of Prince’s tenure as the headline seems to infer (“Man in Citi’s Hot Seat”). Sometimes the media makes the story bigger than it is. There seemed to be more Prince-supporters in the article than not.  Not surprisingly, the writers compared Prince to JPMorgan Chase’s CEO Jamie Dimon. Every CEO seems to have its opposite number that he or she is frequently compared to. Reminds me of the Coke and Pepsi wars. Former Home Depot CEO Robert Nardelli will never seems to escape comparisons to Boeing CEO James McNearney (two former GE CEO contestants). Prince and Dimon are similar foils to one another in the media space. Getting back to my earlier comment about how CEOs matter and command a premium if they are really good: “Fairly or not on Wall Street, a large premium is placed on public leadership and raw personal style. James Dimon, the chairman and chief executive of JPMorgan Chase, has had his own struggles with his investment bank, and he is unlikely to emerge unscathed from the credit crisis. But he also enjoys a large dose of credibility — and forgiveness — on the Street because of his years in the managerial trenches. Although he, too, is a protégé of Mr. Weill and was known more as a deal maker and a cost-cutter before he arrived at JPMorgan, his track record and charisma have inoculated him against the criticisms that now plague his former colleague Mr. Prince.”Prince has lasted longer than the average CEO today. Imagine that he will survive these turbulent times in the sub-prime mortgage market. Am not too worried. He is just keeping the seat warm.

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Leslie Gaines-Ross
Leslie Gaines-Ross
lesliegainesross@gmail.com

As Weber Shandwick’s Chief Reputation Strategist, I focus on the ever changing world of reputation. For the past 25 years, I have relentlessly observed, researched and commented on the rise and fall of reputations.

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