The effect of CEO reputation on brand value

CEO reputation matters to brands and the value they contribute to businesses, according to Annie Brown, Associate at brand valuation consultancy Brand Finance.

Why it matters

As we transition to a new era of more responsible and purpose-driven business, brand managers need to look closely at how their CEO’s reputation is linked to and impacts the brand.

Takeaways

• This year’s Brand Guardianship Index demonstrates that the most famous CEOs are not the most reputable, and the most reputable CEOs are less famous.
• There is more to being a good CEO than fame. Successful CEOs must balance the needs of all stakeholders – customers and employees as well as the short-term desires of investors. This requires a wide range of skills including empathy, motivation and charisma, rather than just determination.
• The COVID-19 pandemic has highlighted the importance of treating employees fairly and ensuring their safety at work, something that has affected brand reputations both positively and negatively over the past year depending on how these issues have been handled.

The big idea

Founders are integral to establishing a business and delivering on their vision. But after a while, if they cannot balance the need for financial return with other demands such as good treatment of employees and quite simply being popular, they have to leave.