by Weber Shandwick
March 10th, 2015

For those responsible for the management of an organisation’s reputation, life has never been particularly straightforward. Product quality relies heavily on an immaculate supply chain; service quality is only as good as the unhappiest employee; and a strong financial performance is only strong if the market says so.

Which is why news that the reputation of the CEO is now considered to significantly influence the reputation of the company might provoke a few sharp intakes of breath in the corporate communications departments of some of Australia’s largest organisations.

In Weber Shandwick’s latest report, The CEO Reputation Premium: Gaining Advantage in the Engagement Era, we reveal that nearly half of Australian senior executives (48%) agree that their company’s reputation is influenced a great deal by their CEO’s reputation.

Particularly startling however is that only 19% of them think the CEO’s reputation is strong outside of the company. That reputation is only marginally better within the organisation, at 32%.

CEO reputation has a marked impact on financial performance too. Globally, executives estimate that 44% of their company’s market value is attributable to the reputation of their CEO. Strong CEO reputation also attracts and retains employees (77% and 70%, respectively).

In some areas, Australian CEOs are considered to outperform those in other markets; 57% of executives surveyed believe their CEO has a clear vision for the company – the highest proportion in Asia-Pacific. However, their ability to communicate this vision is less convincing: only 37% believe their CEO is a good communicator internally and 36% externallyJust 1 in 3 believe the CEO is comfortable talking with the media.

Australian CEO’s willingness to embrace social media is lagging too despite clear evidence that those who do tend to have stronger reputations. Only 36% of respondents see participation in social media as important, 14% think it will primarily harm a CEO’s reputation, and 22% believe it will improve it.

There’s clearly some way to go before Australian CEOs embrace the potential of social media in building their reputation, and therefore, that of their organisation. Such engagement comes with inherent risks of course but so too does it come with significant opportunity. Like all areas of reputation management, clarity, authenticity and preparedness is the priority.

CEOs have always been in the spotlight, but their visibility today is more pronounced. There is an expectation on them to communicate more often and more directly with audiences.

For sleepless reputation managers, that means investing as much energy in the development of the CEO’s equity as it does the organisations. A direct correlation between the brand values of the CEO and the company is now an imperative.

More information about Weber Shandwick’s CEO Reputation Premium report can be found here. Additionally, an Australian-specific infographic that highlights local market results, can be found by clicking on the image below.

About The Research An online survey of more than 1,700 executives – managers through the C-suite, but excluding CEOs – was conducted in 2014. Respondents worked in companies with revenues of $500 million or more (or regional equivalents) and represented 19 countries across North America, Europe, Asia Pacific and Latin America. The margin of error for the full global sample is ±2 percentage points with 90% confidence.

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