What role does the reputation of a company’s chief executive play in the reputation of his or her company and, thus, the likely business success or failure of that company? It’s a crucial question that draws some fascinating answers in the results of new research conducted by PR firm Weber Shandwick.

The second installment of Weber Shandwick’s global research, The Company behind the Brand: In Reputation We Trust – CEO Spotlight, explores how executive leadership and communications from the top are critical to helping reverse the tides of waning respect for companies – a key finding highlighted in The Company behind the Brand: In Reputation We Trust, Weber Shandwick’s initial research published in January.

In its latest research, Weber Shandwick says that 66 percent of consumers say that their perceptions of CEOs affect their opinions of company reputations. Executives, like consumers, also do not overlook the importance of a leader’s reputation, the PR firm says – they attribute almost half (49 percent) of a company’s overall reputation to the CEO’s reputation.

Executive leadership is critical to “burnishing the overall reputation of organizations today,” the firm says, “particularly when it’s estimated that 60 percent of a company’s market value is attributed to its reputation.”

Other significant metrics from Weber’s report include:

• 66 percent of consumers say that their perceptions of top leadership affect their opinions of company reputations a great deal or to a moderate degree – only seven percent say their views on the leader at the top have no bearing on corporate reputation.
• More than 80 percent of executives say that consumers’ beliefs about a company’s top leader affect their opinions of the company at least to a moderate degree.
• 28 percent of consumers report that they regularly or frequently talk about company leaders with others. While this rate is far below how often consumers talk about product quality (69 percent), it is a topic that comes up as nearly as often as company websites (30 percent) and community engagement (29 percent).
• 59 percent of consumers say they are influenced by what top leaders communicate. Surprisingly, says Weber Shandwick, company leadership communications outranks investment-heavy advertising (56 percent) and social network conversations (49 percent), as the chart below suggests.

Word-of-mouth, online reviews and search results lead the list of what most influences consumers when they do talk about companies in general.

This is timely information, not the least significance being a primary discussion topic in this week’s episode #650 of the FIR podcast, published today, in which Shel and I discuss the topical and in-the-news-headlines matters of CEO reputation, citing three CEOs at the heart of reputational issues embroiling their respective companies – Rupert Murdoch (News Corporation), Scott Thompson (Yahoo), and Ben Baldanza (Spirit Airlines).

Shel and I usually record each week’s FIR on a Monday. But this week’s show was recorded on May 5, two days ago. Events may have moved along with regard to these three issues although I think the discussion points when we talked about them are valid. We ask what should the communicators in those organizations be doing to address the crises enveloping their firms? Are the foundations rotten that would therefore make any task difficult if not impossible to succeed? What effect may damage to the CEOs’ individual reputations have on their organizations?

It looks like some clear answers to that last question at least emerge from Weber Shandwick’s research.

(Via The Holmes Report)

Related posts:

• The Hobson and Holtz Report – Podcast #650: May 7, 2012: includes discussion topic “dealing with corporate reputation crises – Rupert Murdoch and News Corp, Scott Thompson and Yahoo, Ben Baldanza and Spirit Airlines.”
• Other posts in this blog under the Category ‘Reputation.’