You Are What You Lead: The Emerging Role of CEOs in Corporate Reputation Management

By Bill Coletti, CEO, Kith

 

Critical Takeaways:

  • Trust in executive leadership is on the decline, which is serious given the direct impact a CEO’s reputation has on a corporation’s reputation
  • A company’s leadership must demonstrate humility in service to the company; in addition to vision, passion and visibility
  • CEOs, regardless of company size or industry, have the opportunity to engage with employees, and should do so frequently and authentically

 

 

CEOs are often viewed as the “face” of the corporation. Mark Zuckerberg, Warren Buffett, Jeff Bezos– each of these individuals is inextricably linked to the business they run, so whatever they do or say is almost as if the business itself is saying it. Therefore, the reputation of a CEO– whether positive or negative– directly impacts a corporation’s reputation. Last month during our “Credit in Critical Moments: The 4 A’s of Reputation” discussion, I unveiled Kith’s 7 Levers of Reputation, the “levers” we believe organizations must pull in order to grow their reputation.  One of the levers, “Leadership Privilege” directly deals with the role of CEOs. Leadership Privilege is where a company’s leadership demonstrates humility in service to their organization, in addition to being present and visible. At Kith, we know how critical the Leadership Privilege lever is to reputation, and current events have only reinforced our beliefs.

 

Recently, Travis Kalanick, CEO of Uber, was heavily criticized for his involvement with President Trump’s Strategic and Policy Forum. This, combined with Uber’s decision to waive surge pricing during airport protests, created a media firestorm and led to more than 200,000 users terminating their accounts with the ride-sharing service. Kalanick eventually resigned from the Forum, but the damage to Uber’s reputation was severe.

 

Source: Will Oliver, EPA

 

Uber’s crisis happened a few weeks ago, but the idea that a CEO’s reputation directly impacts a company’s organization has been around for awhile. A 2015 study by Weber Shandwick revealed two-thirds (66 percent) of global consumers say their perceptions of CEOs affect their opinions of company reputations. Executives feel the same way– the survey revealed global executives attribute nearly one-half of a company’s reputation to the CEO’s reputation.

 

In recent years, the strong correlation between a CEO’s reputation and a company’s reputation may pose a new challenge as employees and the public lose trust in leadership. In its annual Trust Barometer study, Edelman discovered that the credibility of executives has dwindled in every country surveyed. Now more than ever, it’s important that CEOs take a vested interest in their own reputation if they wish to boost their company’s.

 

This requires companies to pull the “Leadership Privilege” lever. A company must have strong, visible leadership with vision, passion, and demonstration of humility in service to the company. By making it clear via words and actions that they are in service to their company and society, CEOs can boost their own reputations as well their organization’s. There are several successful CEOs who are already doing this, and it has resulted in notable gains in employee appreciation and even revenue.

 

Source: David Paul Morris/Bloomberg/Getty Images

 

Facebook CEO Mark Zuckerberg and his team place a great deal of emphasis on Leadership Privilege. The social media platform boasted record sales in 2015, the same year Zuckerberg initiated massive philanthropic efforts and publicly took and promoted paternity leave. His Leadership Privilege regularly earns him a spot on Glassdoor’s Most Beloved CEOs list.  

 

So how can business leaders throttle the Leadership Privilege lever for their own organization? First it requires some self-examination. Do your leaders demonstrate humility in regards to their stewardship of the company? Does your organization have an impressive company culture, one worth bragging about? According to Andrew Hill, management editor for the Financial Times, business leaders “need to set the tone for how their organizations behave and evolve” and emphasizes the need for a “positive culture.” CEOs can do this by engaging with their employees in authentic ways– company town halls, open office hours, or even a personal blog.

 

 

 

Uber’s Kalanick followed this approach and penned a letter to employees and hosted an all-hands meeting, where he emphasized his pride in working for the company and his appreciation of employee input. CEOs, regardless of company size or industry, have the same opportunity to engage with employees, and they should do so frequently and authentically.

 

Can your company leaders be more visible? Is there something more you can be doing to demonstrate humility of leadership?

 

More information about Reputation Management is available in Bill Coletti’s upcoming book Critical Moments: The New Mindset of Reputation Management.

 

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