The Future of Reputation Is a Far Braver and Bolder CEO

I’m a member of the most wonderful WhatsApp Group. Who thought anyone would ever say that, but it’s true. 

It’s a group of around 400 communications and agency leaders from around the world, brought together by industry veteran David Gallagher. It’s an active group – where we debate things as varied as AI to D&I, often in the same moment. So, just the other day I asked a question: “Does anyone have any research on trends and issues relating to CEO Activism?”. 

Silence.

It was the same week the UK’s Financial Times published a story around the need for companies to appoint a 'chief political officer' as part of how they seek to navigate increasingly complex realities. And I can understand why. It’s common cause that the world around us has been as complexed, face paced or multi-themed. never seen as complex, or as fast paced. This dictates how companies choose to manage their long-term reputations. 

But, as well intentioned as it is – the chances are that a 'chief political officer' is both the wrong designation and the completely wrong emphasis. However, it is on the mark when assessing the actual demand for leadership. And … that’s the real issue at play. 

It’s the coming together (read collision) of values – how we see the world, how we behave in the world and how we engage the world. When it comes to value, it’s how we make our money, how we continue to deliver quality products and services and how we provide for all our people in doing so. 

At the centre of all this is the CEO. 

Charged with managing results in the short to medium terms, and equally with the need to create long-term value for society and of course shareholders. But we must not forget that when you incentivise results in the short and medium term you create behaviours that seek to protect and deliver them. 

As a natural consequence of these goals is a deep apprehension for leaders to speak out. Not to lessen any level of complexity, it comes at a time that there is an overwhelming expectation to fill the void left by many political leaders in terms of a meaningful moral compass, the felt impact of services and the much-needed real efforts to create a more homogenous society. 

The intersection of risk adverse CEO and leadership hungry society and consumer is very real. So, the FT was not wrong about a chief political officer, but if anything, it should be a 'chief working with business officer', and it should be employed in government. 

And the academics are already thinking about it. Stanford University has been tracking this since around 2018 (albeit with a natural US focus), and the trends point to key themes that we as reputation leaders need to consider: 

1. CEOs have a clear responsibility to speak up about issues that are important to society. Not just because it matters to the company. 

2. CEO activism influences purchase intent, critical when the expectation on value creation increasingly align with values. 

3. Internally, CEO activism tests company loyalty. Key to this is that employees are the greatest drivers of this advocacy as they seek to work with and in companies that visibly express shared values. 

4. Unsurprisingly, younger generations are more likely to support CEO activism. 

Most importantly is that this is not a US issue, and we would be naïve to treat it as such. Research findings by KRC Research indicate that people around the world believe that CEOs should express an opinion or take action on social issues including race, gender, and politics. In a study commissioned by the European Corporate Governance Institute in February this year, the ECGI found that while most CEO activism events engender positive market reactions, a meaningful fraction of the events are (unsurprisingly) reacted to negatively by investors. Still, the net aggregate effect of CEO activism is positive and it translates into a $30 million gain in shareholder value year-on-year. 

So, the trends aside, and coming back down to earth (we all know that no government is employing a 'working with' officer), the future of reputation management is just this. The elevation of values above that of value, knowing that it is the best and the most sustainable value creator in the short, medium, and long terms. It is the deal maker and the deal breaker. 

Never forget that values trump EVERYTHING – and it’s here that those of us who lead reputation management both on client and agency sides can and should have the most influence on the leaders we counsel. There is no need to go full Elon Musk on an issue, but there is a need to ensure that we use our good corporate citizenship to engender meaningful positive change. Because can we really claim to be good corporate citizens if we are silent on the issues that matter not just because they matter for us. 

If anything, there is a more urgent need to provide a deep sense of security for CEOs to be the voices we all need them to be. We can support this with smarts, science and data, and we can support it with deep heart. 

For me at least … it is no longer negotiable. 

So perhaps I should ask the WhatsApp group a question again: “How can we help our leaders be comfortable leading at the level society demands of us?”. What we do know that if you can’t speak up on the things that define your values, then you don’t actually have any values to claim.