The reputation of CEOs and leaders plays a key role in stakeholder trust in a company, employee motivation and, ultimately, economic success. The question of how this reputation, understood as an aggregated judgement of the stakeholders, can be strengthened is a central question in my work as a sparring partner for executives and boards of directors. It is obvious that this discussion must always be conducted in the context of the reputation of the entire organisation. And, as we know, this is formed from a myriad of points of perception, be it a convincing appearance by the CEO, a clumsy LinkedIn post by the head of marketing, an effective advertising campaign or a frustrating experience with the call centre.
When working with leaders, the first step is to define the topics and values a leader wants to position themselves by. The corporate strategy, corporate values and the personality and values of the leader form the framework for this thought process. Of course, the range of topics is much broader today than it used to be: whereas a CEO used to be able to focus purely on business issues, stakeholders – especially employees, investors, and NGOs – now want to know how the company acts with regard to environmental issues, social responsibility and corporate governance. However, this does not mean that a CEO has to comment on all controversial social issues just because an influential NGO is demanding it.
The digital world is a double-edged sword
The digital world in particular is a double-edged sword when it comes to building the reputation of executives. On the one hand, it offers unrivalled opportunities for positioning and enormous opportunities for branding, employee loyalty and customer proximity. On the other hand, digital platforms harbour risks that should not be underestimated. Within a short space of time, an ill-conceived post can trigger a digital firestorm that quickly has a negative impact on the reputation of the leader and the company. There are plenty of examples of this.
Physical presence becomes more important in a world of fake digital content
With all the euphoria about the advantages of digital channels, an appropriate physical presence is sometimes forgotten. This is despite the fact that we all know that it is direct contact with employees, investors, and journalists that can create a basis of trust and emotional connections. Digital platforms clearly lose out in this respect. And, of course, appearances are not just about what is explicitly said. We humans judge the impact and credibility of a statement much more on the basis of non-verbal and para-verbal criteria. It is therefore just as important to strategically plan appearances at events with employees, investors and business partners as it is to have a content plan for digital channels such as LinkedIn. In addition, the emergence of AI-generated content, including photos and videos of non-real people, has further increased the importance of physical communication.
Acting congruently remains the key to credibility
However, there is one thing that will not change regardless of the new digital possibilities: Reputation will always be based not primarily on what is said and posted, but above all on what is done and how something is done. In short, a CEO’s actions must reflect his or her words. Only congruence between statements and actions can strengthen credibility, authenticity and thus reputation. Examples of successful CEOs show that those who act on their statements have a stronger and more sustainable reputation. The Greek philosopher Democritus already knew this when he said: “Actions prove who we are, words only what we want to be.” A corporate culture in which management is made aware of discrepancies between words and actions as openly and honestly as possible is therefore certainly a major competitive advantage. Unfortunately, the Swiss economy – especially in the recent past – has repeatedly provided dramatic examples of what happens when such a culture is lacking and reputation is continually eroded.
Daniel Piller, Partner
