Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
Today, CEOs of Microsoft, Ford, Delta and other major corporations will begin their National Summit in Detroit, an attempt (some say late) to show some leadership on the broader issues facing the economy. It may also be a first step in repairing their own low reputations.
Even among business people CEOs aren’t thought of so highly at the moment. A study by Weber Shandwick, found only 14% of executives surveyed reported a positive opinion of CEOs.
Does that matter? Yes, says Weber Shandwick’s Chief Reputation Strategist, Leslie Gaines-Ross, a creator of the survey. “We absolutely need the best people to take on the CEO positions. It’s critical for our success, for our competitiveness, for employees and for the US to get out of this economic downturn we’re in. We’re dependent on these people.” Corporate leaders, she says, are going to have to stop looking just at their own problems, and apply some of their brainpower to the bigger picture.
We put that and a few other questions to Gaines-Ross. An edited exchange follows. But she is happy to answer your questions about this research, the importance of reputation to leadership, building a reputation in the digital age, or other topics. So post them and she’ll respond.
BW: Bank of America’s Ken Lewis and the CEO class of 2008-2009 aren’t the first to find themselves in the dog house. Worldcom’s Bernie Ebbers and Tyco’s Dennis Kozlowski are in jail. So is it really news that CEOs aren’t so well regarded?
Gaines-Ross: I’ve been in this world of studying CEO reputations for a good 10 to 15 years. There definitely have been peaks and valleys. Now, in light of what’s happened over the last 12-18 months, is a good time to reinvestigate how CEOs are viewed. Especially because so many companies are looking for CEOs. There’s a big shuffle.
BW: But there's been a surprisingly low rate of CEO turnover in the past year. CEOs were far more likely to hang on to their jobs than their workers were.
Gaines-Ross: I think in 2009, when we look a year from now, we’ll see a rise again. Once the dust settles, and companies realize they need to really start competing at full speed and restore their reputations, I think we’ll see greater CEO turnover. Plus the burnout factor must be incredible. I think everyone’s burnt out top to bottom right now.
BW: What can a CEO do to fix this?
Gaines-Ross: Communicating frequently with their employees. Certainly with their customers too, but not to forget their employees. At a time of uncertainty employees are hungry for information. CEOs need to take responsibility. Apologize if they are wrong. If they don’t know the answer, say they don’t know. We are just starting to see CEOs really being the face of the company.
BW: Surprisingly after their corporate jet fiasco, you have good things to say about the leadership of the Big 3 Auto Companies.
Gaines-Ross: They are being very transparent and accessible whether on social media, or in the general media, giving interviews, etc.. You see a lot stepping up and coming up with solutions. GM has done a good job with their FastLane blog where they have different executives go on. They’re pretty straightforward. They’re out there. I expect tech companies to make the best use of social media, but when you see manufacturers making use of it, that is different.
(CEO Fritz Henderson will be on FastLane tomorrow answering reporters’ questions, then twittering with consumers after.)
BW: Besides being MIA are there other reasons for CEOs' poor showing?
Gaines-Ross: There is a lot of anger and lack of trust about CEO compensation and I think also there’s a sense that CEOs in some sectors were not prepared and looking for the early warning signs they should have, the signs that could have helped prevent this financial crisis. So many employees have lost their jobs, so many families affected.
BW: Can you predict how long CEOs will be in low regard?
Gaines-Ross: We asked executives how long it would take for the reputation of CEOs to fully recover. They said 3.5 years. By 2013 there should be a recovery for the reputation of CEOs. That’s still far away and means they have a lot of work to do. It’s not like we’re going to forget about this in six months. There’s a long term transformation that has to happen.
Your turn. Please post your questions for Gaines-Ross in the comment box below.
How can you manage smarter? Bloomberg Businessweek contributors synthesize insights from the brightest business thinkers, critique the latest management trends, and comment on leaders in the news.