Social pressure is likely to change the nature of leadership and that could boost numbers. Annie Brown, Associate at Brand Finance, explains.
The world’s biggest companies still have a long way to go when it comes to diversity. In 2020, only five FTSE 100 companies were steered by women. Despite 51 years of equal pay legislation and 46 years since the Sex Discrimination Act was passed in the UK, last year actually saw a decline on 2019, when there were six in the top seat.
Fortunately for potential female leaders and in the month of International Women’s Day, there is better news ahead. The latest 2021 Brand Finance Top100 CEO brand guardianship index features eight female CEOs who are champions of the brands they represent, twice the number from the previous year’s report.
That rise, albeit from a low base, signals a bigger change in the nature of leadership, one exacerbated by the current pandemic. The long-term impact of the pandemic may be foggy, but one thing we know for sure: people expect large corporations to treat employees well and the behaviour of their CEO is seen as representative of the company.
Our research found that CEOs need to be ethical, respectful and reputable to enable businesses to succeed in the long term. They must balance the needs of all stakeholders – customers and employees; not just the short-term desires of investors.
In the era of personality CEOs, where public scrutiny can be equal to that of a celebrity figure, it is no longer enough to have a vision for the business’s future. Company leaders need to forge an authentic public profile and react earnestly to reputational crises.
This requires a wider range of skills including empathy, motivation and charisma, rather than just determination, a characteristic of many much-lauded male CEOs.
Across the top 100, our study found that Female CEOs are more reputable than their male counterparts. In addition, female CEOs are seen as more articulate and inspiring than their male counterparts– 23% compared to 7% on average.
To bypass the barriers and social pressures that have kept many women out of senior leadership roles, the top female CEOs historically have had to be more exceptional than their male peers. So much so that the CEO with the top reputation in our Top 100 list of Brand Guardians was Joanne Crevoiserat, CEO of luxury fashion group Tapestry (formerly Coach) having previously served as company CFO and interim CEO of Kate Spade.
On her appointment she said: “Since joining the company over a year ago, I have been focused on unlocking the power of our talented teams by establishing clear priorities and building a culture of trust and empowerment.” A statement that echoes the changing demands on today’s CEO.
Of course, investor return is still important. Another highly reputable CEO is AMD’s Lisa Su, who has turned around the semiconductor firm and boosted stock prices more than 20-fold since taking over the top job in 2014.
Good CEOs are those who nurture relations with all stakeholders and enhance the reputation of their brands as a result. Even investors increasingly care about corporate social responsibility about environmental, social and governance issues.
Boards are starting to recognize the importance of stakeholder management and are appointing CEOs who understand why reputation and stakeholder management matter. We see a growing share of top 100 CEOs with a marketing background, for example – there were 10 in the 2021 index compared to just six in 2019.
Reputation and stakeholder management are essential skills for a world in which the CEO’s actions are increasingly, and inextricably, linked with the good they do for society and the environment and how this impacts the business.
Big name CEOs such as Jeff Bezos and Mark Zuckerberg may be famous, but being famous is no longer what CEOs need to be remembered for. Neither are the actions people take justified, to borrow from Machiavelli, as long as the business makes a profit.
In 2021, brands need to put purpose before short-term profit in order to remain relevant to more conscientious customers. Customers expect brands to solve some of the problems they create and address other challenges consistently, honestly, and inclusively. For boardrooms to achieve brand and business growth, they must be demographically representative of the customer base they seek to address.
As we transition to this new era of more responsible and purpose-driven businesses, CEOs have become more representative of the brands they command and must demonstrate good behavior.
Our research demonstrates that women are just as capable of being exceptional leaders as their male counterparts and are seen as some of the most reputable leaders today. The women who have successfully navigated the system to date have paved the way for future female leaders. Expect to see more of them leading the boardroom soon.
About the author
Annie Brown is an associate at Brand Finance, the world’s largest brand valuation consultancy. She is a qualified management accountant and works on brand and business valuation projects serving global clients such as Barclays and Shell. She is experienced across of variety of services including brand licensing, research analytics, rebrand uplift and balance sheet valuation.
Annie heads up various studies at Brand Finance, including the annual Global Intangible Finance Tracker (GIFT™) and the Brand Guardianship Index. In addition, Annie has conducted research and analysis for the Brand Finance brand rankings.
Annie joined Brand Finance as an Analyst in August 2017 after graduating from The University of Edinburgh with a Masters degree in Philosophy and Economics. She has since completed her CIMA professional qualification.
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