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CEO & Corporate Reputation
Jeanette Dyhre KvisvikManager, Burson-Marsteller, Norway
Hotel Nordica, Reykjavik, Thursday 21. September
2
CEO Reputation
““Despite the size and complexity of Despite the size and complexity of modern corporations, the person in modern corporations, the person in charge still sets the tone, defines charge still sets the tone, defines the style, becomes the company’s the style, becomes the company’s public face.”public face.”
Fortune, Fortune, November 18, 2005November 18, 2005
““It takes a lifetime to build a It takes a lifetime to build a reputation, and only a short time to reputation, and only a short time to lose it alllose it all.”.”
Joseph Neubauer, Joseph Neubauer, CEO of Aramark, CEO of Aramark, BusinessWeek, BusinessWeek,
September 23, 2002September 23, 2002
3
Corporate Reputation
“ “ If you lose dollars for If you lose dollars for the firm by bad the firm by bad
decisions, I will be decisions, I will be understanding. If you understanding. If you lose reputation for the lose reputation for the
firm, I willfirm, I willbe ruthless.”be ruthless.”
Warren Warren BuffettBuffett
4
How to build trust
Stakeholder map- The various needs for communication
Financial society
Political society
The mediaPublic opinion
Internally
CEO &company
5
Agenda
Global Survey- CEO Capital and Corporate Reputation 2005
Norwegian Survey- CEO and Corporate Reputation 2006
An example- Norsk Hydro- Norways second largest oil company
6
Building CEO Reputation - GlobalBuilding CEO Reputation - Global
Now in its fifth wave, Burson-Marsteller’s first CEO Reputation Study was conducted in 1997
The research was conducted online with the Economist Intelligence Unit (EIU), a world leader in global business intelligence and the business–to–business arm of The Economist Group.
The sample includes over 600 business influentials from 65 countries:
– 146 CEOs– 146 senior executives– 188 financial analysts
– 103 business journalists
– 102 government officials
7
The SampleThe Sample
32%
26%
10%
32%
Europe
North America
Asia-Pacific
Latin America
22%
16%
16%
23%
23%
CEOsSenior ExecutivesFinancial AnalystsBusiness JournalistsGovernment Officials
8
CEO Reputation
9
On a global basis, the CEO is held responsible for 47% of a company’s reputation. Europeans and North Americans attribute less responsibility to the CEO than do Asia/Pacific and Latin American influentials.
How much does CEO Reputation Matter?How much does CEO Reputation Matter?
55 %
52 %
44 %
43 %
47 %
0 % 10 % 20 % 30 % 40 % 50 % 60 %
Latin America
Asia/Pacific
North America
Europe
Total
2005 CEO Contribution to Corporate Reputation
10
How does CEO Reputation pay off?How does CEO Reputation pay off?
Rank
Pay attention to what a CEO has to say 1
Recommend company as good alliance/merger partner 2
Give a company more time to succeed 3
Maintain confidence in company when share price lags 4
Buy stock in a company 5
Believe a company under pressure from the media 6
Recommend a company as a good place to work 7
Recommend a company’s stock 8
Prefer a company’s products and services 9
Paying attention to what a CEO has to say and recommending the company as a preferred partner is the greatest benefits of having a good CEO reputation.
SCORECARD
North America Buy or recommend stock
Latin America Recommend company as alliance partner or good place to work
CEOs Maintain confidence when share price lags
The scorecard identifies regions and segments where scores are higher or lower than the average.
11
What builds CEO reputation?What builds CEO reputation?
RankRank
Is credible 1
Attracts & keeps quality management team 2
Communicates clear vision *inside* company 3
Demands high ethical conduct 4
Motivates & inspires employees 5
Manages crises and downturns effectively 6
Communicates clear vision *outside* company 7
Executes well on strategic vision 8
Cares about customers 9
Fosters corporate governance 10
Delivers financial results 11
Increases shareholder value 12
Credibility, attracting quality management and communicating a clear vision internally are the top three measures that shape CEO reputation. Delivering financial results is necessary for a CEO, but being credible is paramount.
Top 12 of 20 CEO qualities
SCORECARD
North/Latin America Demand high ethical conduct
North America/Asia/Pacific Foster corporate governance
Latin America Attract quality management team
Financial Analysts Manage crises/downturns effectively
12
What builds CEO reputation- EuropeWhat builds CEO reputation- Europe
TotalTotal EurEur NANA A/PA/P LALAIs credible 1 1 1 1 1Attracts & keeps quality management team 2 3 3 3 9Communicates clear vision *inside* company 3 2 6 4 3Demands high ethical conduct 4 9 2 5 2Motivates & inspires employees 5 4 10 2 5Manages crises and downturns effectively 6 7 4 8 4Communicates clear vision *outside* company
7 5 8 7 10
Executes well on strategic vision 8 8 9 9 6Cares about customers 9 6 5 10 8Fosters corporate governance 10 10 7 6 12Delivers financial results 11 11 11 13 7Increases shareholder value 12 15 13 11 13
All business influentials agree that credibility drives CEO reputation. Demanding high ethical conduct ranked relatively low for European influentials, possibly because Europeans already expect strong ethics from their companies’ leaders.
= lower than total = higher than total Top 12 of 20 CEO qualities
13
Top 25 Most Admired CEOsTop 25 Most Admired CEOs
Worldwide, Bill Gates is the most admired CEO by business influentials by a large margin.
Steve Jobs and Warren Buffett rank a distant second and third.
CEOs from North American, European and Asian/Pacific companies are represented on this most admired list.
CEOCEO CompanyCompanyJeff Bezos Amazon.comJohn Bond HSBC HoldingsRichard Branson Virgin GroupJohn Browne BPWarren Buffett Berkshire HathawayJohn Chambers Cisco SystemsMichael Dell DellLawrence Ellison Oracle
Bill Gates Microsoft
Carlos Ghosn Nissan & RenaultJeffrey Immelt General ElectricSteve Jobs Apple ComputerHerb Kelleher Southwest AirlinesA.G. Lafley Procter & GambleTerry Leahy TescoLakshmi Mittal Mittal SteelRupert Murdoch News Corp.N. R. Narayana Murthy InfosysJorma Ollila NokiaAzim Premji WiproCarl-Henric Svanberg EricssonRatan Tata Tata GroupDaniel Vasella NovartisMeg Whitman eBayJack Welch General Electric
14
Top 25 Most Admired CEOs: European InfluentialsTop 25 Most Admired CEOs: European Influentials
Among European business influentials, Bill Gates is the most admired CEO worldwide.
CEOCEO CompanyCompanyJosef Ackermann Deutsche BankJohn Bond HSBC HoldingsPeter Brabek NestleRichard Branson Virgin GroupJohn Browne BPWarren Buffett Berkshire HathawayJohn Chambers CiscoMichael Dell Dell
Bill Gates Microsoft
Carlos Ghosn Nissan & RenaultFred Goodwin Royal Bank of ScotlandJeff Immelt General ElectricSteve Jobs AppleTerry Leahy TescoLakshmi Mittal Mittal SteelRupert Murdoch News CorporationJorma Ollila NokiaHelmut Panke BMWHoward Stringer SonyCarl-Henric Svanberg EricssonRoger Talermo Amer GroupDonald Trump TrumpDaniel Vasella NovartisJack Welch General ElectricWendelin Wiedeking Porsche
15
Corporate Reputation
16
Drivers of Corporate ReputationRankRank
High quality products and services 1Communicates effectively externally 2Has high quality management 3Focuses on serving customers 4Is honest with stakeholders 5Attract, develop & retain talent 6Is well-governed 7Communicates effectively internally 8Behaves ethically 9Responds effectively to change 10Is a good financial performer 11Is innovative 12Is a good place to work 13Is socially responsible 14Is an industry leader 15Is environmentally responsible 16Is truly global 17Is the largest in its industry 18
SCORECARD
Europe Stakeholder honesty and ethical behavior
Asia/Pacific Honesty with stakeholders and good governance
Communicating externally
CEOs Focus on serving customers
Financial Analysts Honesty with stakeholders and effective internal communications
High quality management
17
Drivers of Corporate Reputation
TotalTotal EurEur NANA A/PA/P LALAHigh quality products/services 1 3 1 1 2Communicates well externally 2 1 3 6 1Has high quality management 3 4 2 4 4Focuses on serving customers 4 2 8 5 7Is honest with stakeholders 5 10 5 2 3Attract, develop, retain talent 6 5 6 9 9Is well-governed 7 8 7 3 5Communicates well internally 8 6 10 7 8Behaves ethically 9 12 4 8 6Responds effectively to change 10 7 9 11 13Is a good financial performer 11 11 11 10 10Is innovative 12 9 12 12 11Is a good place to work 13 13 13 13 12Is socially responsible 14 14 15 14 15Is an industry leader 15 16 14 15 16Is environmentally responsible 16 15 16 16 14Is truly global 17 17 17 17 17Is the largest in its industry 18 18 18 18 18
Europeans rank external communication as the number one driver of company reputation.Honesty with stakeholders was ranked relatively low, possibly reflecting a European expectation for honest behavior.
= lower than total = higher than total
18
Payoffs of Good Corporate Reputation
TotalTotal
Ability to attract and retain talented employees 1
Ability to attract new business/partners/acquisitions 2
Increased loyalty from customers/clients 3
Confidence the company will do the right thing 4
Ability to quickly recover from reputation problems 5
Better able to withstand economic ups and downs 6
Better relations with regulators/government 7
Higher share price than competitors 8
Ability to charge premium prices 9
Attracting top talent is the biggest payoff of developing a good corporate reputation. Other perceived payoffs include the ability to attract new business and increased customer loyalty.
SCORECARD
Latin America Confidence that company will do the right thing
Latin America/Asia Pacific Better relations with regulators/government
CEOs Confidence that company will do the right thing and a higher share price.
19
Our Approach
Client CharterClient Charter
Desired Desired Business Business ResultsResults
Corporate Reputation ResearchCorporate Reputation Research
CEO Reputation ResearchCEO Reputation Research
Corporate Brand Valuator Corporate Brand Valuator
Fortune’sFortune’s America’s Most Admired Companies America’s Most Admired Companies
Fortune’sFortune’s Global Most Admired Companies Global Most Admired CompaniesReputation IndexReputation Index
Brand Asset Valuator (BAV)Brand Asset Valuator (BAV)
InsightsInsightsAnalysisAnalysis
Assessment Assessment
Reputation Report CardReputation Report Card
CEO Reputation Report CardCEO Reputation Report Card
Culture Capital AssessmentCulture Capital Assessment
Corporate Equity AnalysisCorporate Equity Analysis
Seasons of a CEOSeasons of a CEO
Environmental ScanEnvironmental Scan
Competitive Platform Analysis/BenchmarkingCompetitive Platform Analysis/Benchmarking
Strategic Strategic ProgrammingProgramming
Corporate IdentityCorporate Identity
Vision and Values Vision and Values CEO Platform DevelopmentCEO Platform Development
CEO’s First 100 DaysCEO’s First 100 Days
Integrated Communication Integrated Communication
StrategyStrategy
Brand DefinitionBrand Definition
Thought LeadershipThought Leadership
Creative Creative ExecutionExecution
Media RelationsMedia Relations
CEO Dance CardCEO Dance Card
Investor RelationsInvestor Relations
Employee & Constituency EngagementEmployee & Constituency Engagement
Web CommunicationsWeb Communications
Corporate and Internal AdvertisingCorporate and Internal Advertising
Customized Training ProgramsCustomized Training Programs
Corporate Social ResponsibilityCorporate Social Responsibility
Results Results and and
MeasurementMeasurement
Stock Price/Market ShareStock Price/Market Share
Rankings & ScorecardsRankings & Scorecards
Feedback AnalysisFeedback Analysis
Culture QuotientCulture Quotient
Recruitment & RetentionRecruitment & Retention
Media Coverage/PenetrationMedia Coverage/Penetration
Strategic Stakeholder Strategic Stakeholder
MessagingMessaging
Leadership Leadership DevelopmentDevelopment
Rewards & RecognitionRewards & Recognition
Crisis PreparednessCrisis PreparednessMeasurement PlanningMeasurement Planning
Foundation ConsultingFoundation Consulting
CurrentCurrentReputationReputation
Scorecards Scorecards
20
CEO CAPITAL CEO CAPITAL NORWAY NORWAY 2005/20062005/2006
21
The Norwegian companies included in the study
22
Who are the respondents?
Toppledere
Analytikere/ Meglere
Journalister Media
Investorer
3
0
10
20
30
40
50
60
70
80
90
100
Executives
Financial analysts
Business journalists
Investors
Government officials
The only survey in Norway measuring reputation amongst Business Influentials
Source: Burson-Marsteller og Research International Topplederundersøkelse 2005
23
Who are not the respondents?
24
CEO Reputation
Company Reputation
The power of reputation
Profitability
- Share price- Revenue- Turnover
Other factors
- Alliance/ merger partner- Recruiting and retaining - Power
In business Politically
which influences
is responsible for 47 % of a
Kilde: Burson- Marsteller analyse; Burson-Marsteller/ Economist Global CEO Capital, 2005
A good reputation is a rapidly increasing success factor in today's society
Sum up
25
What is the most important driver when deciding to invest in a company?
??
26Data: Tall i % av base: 135/88. Figuren viser andelen som har svart 9-10 på en 10-delt skala for betydning for valg
Quality of leadership and ability to adjust to change is the most important drivers when investing in companies
What is most important when deciding to invest in a company?
A trusted and good management is more important than financial situation
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
Leadership
Adjust to change
Quality of productsand services
Credibility
Financial situation
Innovation
Specific skills or technology
Ability to recruit and retain
Loyal customers
Strong brand
Financial track record
Environmental focus
Social responsibility
2005
2003
48
47
38
38
31
29
28
27
21
16
14
10
8
40
25
38
42
25
13
17
26
29
22
23
11
12
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
27
Tall i % av base: 135/88. Figuren viser andelen som har svart 7-10 på en 10-delt skala for grad av påvirkning
To what extend does your opinion of a CEO affect your will to.....
2005
2003
In addition, the CEO reputation affects other key success factors for the company…
76
74
71
70
61
46
34
70
34
72
62
39
24
69
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Recommended as a alliance/merger partner
Believe in company despite negative media coverage
Potential employer
Buy stocks in the company
Believe in company despite share price develops below index
Be informed of company's development
Buy company's products and services
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
28
Is there a correlation between the CEOs reputation and the company's reputation?
??
29
There is a strong correlation between the CEOand the company reputation
The correlation proves that the trust in the CEO is crucial for a company’s reputation
Correlation
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
30
Big changes in companies reputation since 2003 shows that the reputation is in motion
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
0
25
50
75
100
0 25 50 75 100
Co
mp
an
y r
ep
uta
tio
n
Tall i % av base generelt inntrykk: 90. Figuren viser andelen som har svart 7-10 på en 10-delt skala for tillit (x-aksen) og andelen som har svart 7-10 på en 10-delt skala for inntrykk (y-aksen)
CEO Capital
Reputation is easily broken down in a crisis, but the reputation may be restored within 2 years
31
Reputation recovery is possible, but demands focus
Data: Tall i % av base: Norge 107 som har svart, Globalt: Ca 600
2,2
3,2
Norway 2005
Global 2005
0 0,5 1 1,5 2 2,5 3 3,5 4
Comparison of the two studies shows that the time to recover the reputation is shorter in Norway than globally
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
Average in years
32
What measures must be taken to build reputation?
??
33
To build and sustain a company's reputation, the focus must be on ethics, good leadership and results…
Data: Tall i % av base: 135. Figuren viser andelen som har svart 5-6 på en 6-delt skala for viktighet
200587
79
79
78
76
74
73
71
66
64
55
54
53
52
52
49
14
12
Ethics
Trust in CEO
Financial results
Quality products and services
Customer focused
Attracts and retain good employees
Communicates effectively externally
Adjust to change
Corporate governance
Innovative
Social responsibility
Industry leading
A good place to work
Environmental
Stakeholder openness
Communicates effectively internally
Company size
Global company
0 20 40 60 80 100
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
The focus on ethics is very high in Norway compared to the global and European results
34Base: Tall i % av base: 135/88. Figuren viser andelen som har svart 9-10 på en 10-delt skala for viktighet
2005
2003
How important is it for your trust in the CEO that…
71
66
63
62
58
57
53
38
38
36
31
30
62
58
54
50
60
52
44
38
37
29
22
60
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100 %
Sets high ethical standards
Creates good financial results
Have a good management team
Have the ability to adjust to changes
Manage crisis in a credible way
Turn company's strategies into action
Informs of company's strategies and visionsto employees
Handles the media in a credible way
Focuses on customer relations
Retain and develops employees
Informs of company's strategiesand visions externally
Focuses on social responsibility
When the company reputation and the CEOs reputation depends on the same criteria, it shows how the company and the CEO is identified with each other
… the same criteria is also the most important to buildand sustain a CEOs reputation
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
35
Data: Tall i % av base: 135/88. Figuren viser kilder der man lærer mest om den enkelte toppleder
Business newspapers are the most important communication channel for CEOs and companies
•TV, radio and the internet has become more important as a reputation communication channel the last two years due to a rapidly increasing focus in business news
•In addition, conferences, seminars and other meeting arenas has increased in importance
Fra hvilke kilder lærer du mest om toppledere?
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
36
To build trust, a CEO must show the ability to take action within the first 6-8 months in the position…
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
Tall i % av base: 135/88
0 3 6 9 12 15 18 Months
Tall i parentes: antall måneders endring fra 2003
…to acquire the trust of the employees
7 months (0)
…to establish good relations for the
company
10 months (0)
…to improve the financial results
17 months (+1)
…to attract a management team
with the right competence
7 months (-1)
…to establish the company's visions
and strategies going forward
8 months (+1)
…to turn a negative trend around
15 months (+1)
37
Do you believe that the chairboard fires their CEOs too fast?
Data: Tall i % av base: 135/88
20052003 In time
32%
Too early49%
Too late
16%
In time55%
Too early16%
Too late
30%
• Twice as many business influentials than in 2003 believes that CEOs should be fired earlier
• The percentage that believe the CEO should be given more time is down from 49% to 16%
The demands for the CEO ability to take action and show results are increasing
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
38
Zooming in on Norway's 2nd largest company
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
39
Hydro has the best reputation amongst business influentials
Data: Tall i % av base inntrykk: 135/88. Figuren viser andelen som harsvart 7-10 på en 10-delt skala for inntrykk
2005
2003
88
78
78
72
72
69
56
53
46
41
39
33
27
25
16
13
79
50
27
73
60
24
28
42
12
78
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Hydro
Hydro on top
Potential reasons:
• Good results
• Strong management
• High ethical standards
• High profile- 100 years
Company reputation
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
40
Hydro has a solid and evenly divided trustamongst key stakeholders
100
79
9093
81
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Hydro
Investors
Analysts
Journalists
Executives
Government
Investors have full confidence in Hydro, but Hydro should strengthen its position amongst governmental officials and analysts
Company reputation – divided by stakeholders
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
41
Hydro
Data: Tall i % av base: 135/88. Figuren viser andelen som harsvart 7-10 på en 10-delt skala for inntrykk
92
91
73
73
71
68
66
65
65
65
52
37
37
35
33
31
37
79
55
49
58
27
48
65
27
75
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
The Hydro CEOs reputation is the second highest amongst the measured companies
2005
2003
Eivind Reiten is amongst the countries most trusted leaders and has increased the trust the last two years
Trust in CEO
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
42
Eivind Reiten has a higher trust amongst analysts than the company itself (79% vs. 94%)
Media and governmental officials has the lowest trust amongst stakeholders
100
94
90
92
86
70%
80%
90%
100%
Hydro
The trust in the Hydro CEO varies more amongst the business influentials than of the company
Trust in CEO- Divided by stakeholders
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
Investors
Analysts
Journalists
Executives
Government
43
Tall i % av base : 88. Figuren viser andelen som har svart 7-10 på en 10-delt skala for tillit (x-aksen) og andelen som har svart 7-10 på en 10-delt skala for inntrykk (y-aksen)
0
10
20
30
40
50
60
70
80
90
100
0 10 20 30 40 50 60 70 80 90 100
Inntrykkav selskap
Tillit til toppleder
Trust in CEO and company reputation in 2003
Svært godt
Svært dårlig
Svært lav Svært høy
Hydro
Hydro had a high trust in both CEO and in company in 2003
Korrelasjonsområde
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
44
Hydro
Trust in CEO and Hydros reputation has increased further from 2003 to 2005
Hydro is number one
Danger- The only way is down
Korrelasjonsområde
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
45
That’s all folks!
Applause
46
Back up
47
“In today’s world, where ideas are increasingly displacing the physical in the production of economic value, competition for reputation becomes a significant driving force, propelling our economy forward.”
Alan Greenspan
Federal Reserve Chairman
Corporate Reputation
48
Hydros toppleder har meget høy kjennskap blant norske beslutningstakere
2005
2003
Data: Tall i % av base : 135/88. Figuren viser andelen som har svartkjenner svært godt/lite grann til
95
93
92
90
85
85
85
83
77
64
62
53
47
35
17
12
95
97
87
84
89
90
90
80
76
87
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Hydro
Vår analyse viser at kjennskap er en forutsetning for topplederens tillit
Kjennskap til toppleder
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
49
Myndigheter og journalister har best kjennskap til Hydros toppleder
Hydro har lavest kjennskap blant meglere/analytikere, og forholdsvis lav hos investorer og andre ledere
Kjennskap til toppleder- fordelt på målgrupper
92
84
97
90
97
70%
80%
90%
100%
Hydro
Investor
Megler/analytiker
Journalist
Toppleder
Myndighet
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
50
Tilliten til toppleder versus kjennskap til toppleder
92
100
84
9497
90909297
86
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
110%
120%
Godt samsvar mellom kjennskap og tillit
Norske myndigheter har lavere tillit enn kjennskap til Reiten , mens det er omvendt for meglere og analytikere
Investor
Megler/analytiker
Journalist
Toppleder
Myndighet
KjennskapTillit
Tillit
TillitTillitTillit KjennskapKjennskapKjennskapKjennskap
Tillit til toppleder og kjennskap til toppleder - fordelt på målgrupper
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
51
Hydros omdømme viser en solid oppadgående trend fra 2001-2005
Tall i % av base inntrykk: 135. Figuren viser andelen som har svart 7-10 på en 10-delt skala for tillit (x-aksen) og andelen som har svart 7-10 på en 10-delt skala for inntrykk (y-aksen)
Inntrykkav selsk.
Tillit til toppleder
Hydro 2005 Svært godt
Svært dårlig
Svært lav Svært høy
Hydro 2003
Hydro 2001
0
10
20
30
40
50
60
70
80
90
100
0 10 20 30 40 50 60 70 80 90 100
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
52
Hva tar vi med oss videre…
Hydros omdømme helt på topp ” The only way is down”
Tilliten til Hydros toppleder Eivind Reiten er forholdsvis ujevnt blant beslutningstakerne
Hydro bør fokusere mer på kommunikasjon mot myndigheter og media
Hydro kan fokusere mer på kommunikasjonen mot analytikere
* Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005
53
Management Team Reputation Six out of ten worldwide business influentials (60%) believe the
reputation of the executive management team is more important now than it was two years ago.
60%
36%
3%
MoreImportant
Just asImportant
LessImportant
More important vs. two years ago
60% 58%64%
56%
70%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Total Eur NA A/P LA
Importance of Executive Management Team Vs. Two Years Ago
54
Selskapets omdømme blir stadig viktigere, og tillit til toppleder er nå avgjørende for selskapets omdømme...
Vår globale undersøkelse viser at topplederen utgjør 47% av selskapets omdømme
* Kilde: Den globale undersøkelsen CEO Capital laget av Burson-Marsteller og The Economist (EIU), gjennomført høsten 2005
Hvor stor betydning har tilliten til en toppleder for din oppfatning av selskapet
55
Who Wants to Be CEO?
56
Who Wants to Be CEO?
TotalTotal Eur.Eur. NANA A/PA/P LALAWant to Be
CEO 46% 40% 36% 49% 73%
Do NOT Want to Be CEO
54 60 64 51 27
A majority (54%) of global business influentials do not want to be CEO.
Europeans (60%) and North Americans (64%) are less likely to want the job and Latin Americans are the most eager.
= lower than total = higher than total
57
Why Want to Be CEO?
Rank*Rank*Enjoy complex problem-solving 1Directly affect the business 2Implement my ideas 3Help company go from good to great 4Build a company to last 5Make a difference in the world 6Build future leaders 7Contribute to employee well-being 8Earn generous compensation 9Reach the pinnacle of my career 10Serve in a prestigious position 11
Global business influentials believe solving complex problems is the most enjoyable part of being CEO. The top five reasons for wanting to be CEO reflect the desire to be involved in running the business at the deepest level.
SCORECARD
Latin America Enjoy complex problem-solving
Executives/ Financial Analysts Can directly affect the business
Media/Government Can directly affect the business
Media Get to build leaders
Compensation is generous
* Does not include CEO responses
58
Why Want to Be CEO?
Total*Total* Eur.*Eur.* NA*NA* A/P*A/P* LA*LA*
Enjoy complex problem-solving 1 1 1 1 1
Directly affect the business 2 2 2 2 2
Implement my ideas 3 3 3 4 4
Help company go from good to great 4 4 4 3 3
Build a company to last 5 6 6 5 6
Make a difference in the world 6 5 5 6 7
Build future leaders 7 9 7 7 5
Contribute to employee well-being 8 7 8 9 8
Earn generous compensation 9 8 9 8 9
Reach the pinnacle of my career 10 10 11 10 10
Serve in a prestigious position 11 11 10 11 11
Business influentials of all regions believe solving complex problems is the most enjoyable part of being CEO. Compensation and prestige are the least important factors to influentials, regardless of region.
= lower than total = higher than total * Does not include CEO responses
59
Why Not Want to Be CEO?
Rank*Rank*Too little work/life balance 1Too much focus on quarterly earnings 2Too much stress 3Too much public scrutiny 4Sarbanes-Oxley and other regulations 5Too much pressure to reduce costs 6Difficulty attracting and retaining talent 7Too many stakeholder demands 8Excessive media scrutiny 9Too much travel 10Too much board oversight 11Overly competitive business environment 12Diminished authority 13Compensation not worth the effort 14
The biggest concern about being CEO is the lack of work/life balance. Other prevalent concerns are the quarterly earnings focus, general stress and public scrutiny.
SCORECARD
North America/Europe Sarbanes-Oxley/ Regulations
Asia Pacific/Latin America Sarbanes-Oxley/ Regulations
Europe Too much pressure to cut costs
CEOs Work/life balance and public scrutiny
Attract and retain talent
* Does not include CEO responses
60
Why Not Want to Be CEO?
Total*Total* Eur.*Eur.* NA*NA* A/P*A/P* LA*LA*Too little work/life balance 1 1 1 1 1Too much focus on quarterly earnings 2 3 2 2 4Too much stress 3 2 3 3 2Too much public scrutiny 4 4 4 4 3Sarbanes-Oxley and other regulations 5 6 5 7 9Too much pressure to reduce costs 6 5 6 8 7Difficulty attracting and retaining talent 7 9 7 5 8Too many stakeholder demands 8 7 8 6 6Excessive media scrutiny 9 8 9 9 10Too much travel 10 10 10 14 5Too much board oversight 11 11 11 10 14Overly competitive business environment 12 13 14 11 11Diminished authority 13 14 12 12 12Compensation not worth the effort 14 12 13 13 13
For all four regions, lack of work/life balance tops the list for reasons to not want to be CEO. Other prevalent concerns are the focus on quarterly earnings, general stress and public scrutiny.
= lower than total = higher than total * Does not include CEO responses
61
CEO Reputation payoff in EuropeCEO Reputation payoff in Europe
TotalTotal EurEur NANA A/PA/P LALA
Pay attention to what a CEO has to say 1 1 1 1 2
Recommend company as good alliance/merger partner 2 3 2 4 1
Give a company more time to succeed 3 2 5 2 4
Maintain confidence in company when share price lags 4 4 7 3 5
Buy stock in a company 5 5 4 5 6
Believe a company under pressure from the media 6 7 3 7 8
Recommend a company as a good place to work 7 6 8 6 3
Recommend a company’s stock 8 8 6 8 7
Prefer a company’s products and services 9 9 9 9 9
Influentials in Europe report that CEO reputation has the greatest influence on their likelihood to listen to what a CEO has to say and recommend the company as the preferred partner.
= lower than total = higher than total
62
Profitability Vs. Social Responsibility Global business influentials believe that 74% of a company’s
responsibility is to make a profit and 26% is to advance societal interest. The debate over profit vs. corporate responsibility continues to be hotly discussed in the media.*
74%
26%% responsibiltyto make a profit
% responsibilityto advancesocietal interest
33%67%
25%75%
24%76%
27%73%
26%74%
0% 20% 40% 60% 80% 100%
LA
A/P
NA
Eur
Total
Profit Vs. Societal Interest
* “Social Responsibility: Do The Right Thing,” BusinessWeek, 15 August 2005
Profit Societal interest