CEO Branding in the Global Reputation Economy

Introduction

by Fabrizio Testa¹

Since the first Italian edition of this book, Borsa Italiana, part of the Euronext Group, has closely followed the meticulous process of collecting and analysing data and testimonials that culminated in its publication. Particularly now, with its English edition, we are deeply interested in a subject like corporate reputation, not only in Italy but across all the markets where Euronext operates.

Corporate reputation is paramount due to its pivotal role in fostering trust, credibility, and competitive advantage. A positive reputation nurtures customer loyalty, attracts top talent, and instils investor confidence. Moreover, it helps companies in effectively managing crises and navigating regulatory challenges. Ultimately, a favourable reputation significantly influences a company’s financial performance and long-term success, underscoring its importance as a valuable asset that necessitates careful cultivation and protection.

This volume authored by Gabriele Ghini and Stefania Vitulli includes significant testimonials on corporate reputation, striking an interesting balance between theoretical insights and practical on-field experience. The selection of cases encompasses a diverse range of companies, both small and large, listed and unlisted, with varying managerial and entrepreneurial cultures. It constitutes a valuable resource for individuals seeking to delve into the interpretation of reputational strategies in the corporate realm, whether for academic pursuits or professional endeavours.

Another pertinent observation highlighted in the book, corroborated by our own experiences, pertains to the impact of going public on corporate reputation. We agree that corporate reputation and listing are intricately linked. Indeed, while the former is a prerequisite for a successful listing, the latter exerts significant reputational influence. The enhanced corporate processes and internal controls mandated for listing, coupled with heightened transparency demanded by markets, contribute to the fortification, and sometimes establishment, of a genuine stakeholder management ethos. Continuous engagement with investors facilitates companies’ improvement both in business performance and reputation enhancement.

Of particular interest to markets is the role of ESG (Environmental, Social, and Governance) factors in shaping a company’s reputation capital, representing a strategic imperative. Reputation serves as a magnet for capital, necessitating companies to take a leading role in these initiatives for success.

Borsa Italiana is dedicated to ensuring that companies increasingly align with the expectations of all stakeholders, not just shareholders, but also the broader society, including the communities in which they operate. This book starts from the same assumption, and we anticipate it will further stimulate the attention every company should devote to the reputational theme. Enhancing corporate reputation is pivotal in fostering fruitful relationships with all stakeholders and, consequently, positions companies as attractive players in the capital market.

¹ Appointed Chief Executive Officer of Borsa Italiana, part of the Euronext Group, in November 2021, joined the Managing Board of Euronext NV in May 2022. From 2014 to 2021 Fabrizio held the position of CEO of MTS, the leading electronic market in Europe for trading fixed income securities. First years of his career in Bank of America in Milan and London, where he was part of the Treasury team responsible for trading government bonds.

1CEO and Brand: Embodying Competitive Advantage

by Stefania M. Vitulli

Impression is for the now, trust is for the future.

Sentence on a teabag

1.1For the sustainability of the CEO as a possible leader

If I had to indicate the two reasons that make a book such as this necessary, or in any case the discussion of this topic, I would certainly say, on a similar level, the predominance the ethical purposes of the business have assumed in the perceptions of citizens and consumers on one hand, and on the other, the incessant call to leadership that Generation Z and Light Millennials invoke against companies’, or better still, brands. Companies which will know how to condense influence, credibility, and charisma into global and local reference figures with human approaches and intentions will have won the challenge of the next few years: Individuals seek other individuals they trust as transparent and visionary decision-makers, and this research does not take place in the political or no profit sphere, the educational field, the media, or the military, but as researchers have concluded, in the world of business. It is true that companies are blamed as being responsible for climate damage, but regardless, it is always the companies and not the non-governmental organizations (NGOs) or political parties that can represent the engine of change that could save us from catastrophe.

Companies are asked to:

Take position.

Keep dialog open 24/7.

Focus on ethical goals.

Be flexible and authoritative at the same time.

Achieving these goals, or at least attempting to, is not possible without being brave and shameless. Nassim Nicholas turned the business world upside down in mid-economic crisis in 2007 by publishing the book Il Cigno Nero¹ (The Black Swan), which put in check the mental rigidity shown up to then by political, economic, and financial global management, that is, the presumption of being able to predict the events that disrupt the world, from World War I, to 9/11, to the creation of Harry Potter. Ten years later, Taleb tried again with Rischiare Grosso² (Skin in the Game), a book that preaches to a world that grabs the winning poker chips by transferring the risk to those who has never even seen the counter, giving importance to putting at stake everything which has been earned, or expected to earn, but above all your essence without incentives, while accepting both losses and consequences.

This is an uncomfortable concept, also the only one that would allow a leader to look behind and find a crowd following him. The intention, however, constituting the indispensable kick-off, is not enough. Being willing to take a big risk is completely useless if nobody knows about it. Almost a century of literature on the subject of corporate communication marks that the 20s of the new Millennium are and will be a time in history where a lack of communication is not only pointless but counterproductive.

In summary, the new generations do not reject the concept of profit, provided that it is the reward for social responsibility exercised with fairness and an open mind, as long as they have the decision on who to reward. Therefore, we need leaders capable of acting clearly and communicating in a coherent and effective way in regard to the values and objectives of their organizations. CEO training to embody this idea of leadership is not only necessary for companies, but vital: Those who will not grasp this challenge in the short term will be swallowed by the media which prefers, even in visibility, relevance and coherence, or a strategic and adaptive vision. This training, however, must be able to work simultaneously on models derived from the management of complex situations and on the ability to understand psychological and cultural variables (in one word: human) that whoever is brave and shameless must be able to consider. A plastic CEO, a puppet governed solely by business reasons, as well as a self-centered CEO who responds only to himself and to mandatory and non-delegable principles, will receive the same refusal to engage from economic and ethical stakeholders, especially if younger. We are far from creating a simple list of purposes, skills, and objectives, so we can start from the theory: How CEO and business are aligned, how corrections are made to possible aberrations, and how medium and large companies in Italy are reacting to the demand of markets and individuals in looking for their own reputational routes.

1.2CEO branding as a strategic tool: reasons for this book

CEO branding is a relatively recent theme in the discipline of brand management at the corporate communication level. In the early days of its diffusion, the business world was touched in a very superficial way, neither intentionally nor strategically, from the organizational conceptual flow relating to this theme for the areas relating to image and reputation. However, a series of macrotrends of contemporaneity and their synergy and global interconnections have led to an essential exponential development³ for organizations, therefore of the theories around the management of organizations, and consequently of the theory and practice around this subject.

Here we mention a few, for the benefit of an overall structure:

Digital acceleration.

Media recognition and exposure of the executive line and the company board.

Cocreation of value in intangible assets by stakeholder communities.

Multi-stakeholder engagement in corporate communication strategies.

Birth and development of Corporate Activism.

Call of companies to citizenship by Light Millennials and Generation Z.

Consequently, in less than 10 years, thanks also to the best and worst practice media practices of some CEO superstars who have had a founding character (see Chapter 2), CEO branding has become one of the corporate communication tools on which internal resources of communication, external consultancy activities, and the academy are being exercised on a strategic level, both for building trusted models and to historicize what has happened and what is expected.

This is why discussing this topic and providing pragmatic managerial guidelines of reference, with a pull approach on the adoption of these practices in companies of all sizes including start-ups, becomes a priority as well as a necessity, for which purpose this book was created. In the first few chapters we want to frame the state of things thus what it is, why to consider CEO branding, in which corporate purposes it finds ground for development, and who has been the Superstar CEOs so far. Together, we will direct the discussion toward the state of art which will be reached in the following chapters, where scenarios and case studies leave almost entirely the place for the description of the Italian reality, both in small- and medium-sized enterprises, as well as in the thinking of some of the most illustrious Italian CEOs, who direct some of the largest companies and turnover.

1.3CEO and brand: understanding osmosis

When observing the role of CEOs as part of communication strategy, or the management of the organization in its most exclusive and authoritative responsibilities,⁴ there is a wider potential than usual. Its figure becomes a means to involve stakeholders and earn their approval. The CEO creates a brand of himself and behaves like a brand: promoting itself with the aim of creating engagement⁵ with stakeholders, be pleasant with them, gain approval, creating, maintaining, and improving its reputation.⁶

This embodiment, however, is neither an automatism nor can it become a predefined model once and for all. Instead, it is a dynamic process with several complex steps that lead to a possible communication plan that invests the CEO in the role of cocatalyst of stakeholder engagement, and, if studied strategically as the last decade demonstrates, will have positive effects on corporate reputation.

Before focusing more on the dynamics related to the CEO branding phenomenon, it is essential to understand what defines a brand, since it is from this area that the dynamics themselves are borrowed. If we want to refer to the classic, a first definition of a brand is given by the American Marketing Association, according to which a brand is a name, term, symbol, design, or a combination of all these variables, intended to identify the goods or services of a seller or a group of sellers, and to differentiate from those of competitors.

Of course, since the 1960s, the definitions have multiplied and the concept has evolved, to the point that this definition today could be considered not only too simplistic, but incomplete or even inaccurate. However, it already contains supporting elements that today make us think of the CEO as a possible multiplier of any communication effort that the company puts in place to create and maintain a positive reputation with the stakeholders on which it depends⁷: creation and maintenance of identification and differentiation of a good or service. The brand is an intangible, holistic, and strategic resource and bearer of value for the organization, allowing it to gain a competitive advantage.

Keeping this perspective in mind, we will therefore have to understand the logic of branding applied to the CEO: If, thanks to the brand, the market is able to recognize a product or service and differentiate it from the competition, this is the potential which must be built, nurtured, and exploited also in the CEO in the moment in which we decide to adopt the CEO branding tool within our strategic corporate communication.

Naturally, as we previously stated, the definition given by the AMA of brand finds itself today exploded in complexity that provides the brand with multidimensional and synergistic functions. According to the most recent interpretations, which we will not go into excessive detail, but to which we refer to for completeness, in the mind of the stakeholder, the brand is no longer just a name or a symbol but has multiple functions all capable of impacting both the relationship with the stakeholder and the value of the company:

Recalls through its attributes, qualities, strengths, and weaknesses of the goods or service.

Contains distinctive values and culture, representative of those of the company.

Suggests a personality that allows stakeholders to identify themselves, and companies to confidently address certain users rather than others (Kotler 2002).

It is perceived as an entity that arouses sensations and feelings in the consumer.

It is a facilitator in building the relationship, thanks to the brand personality.

Amplifies value thanks to brand equity.⁸

It plays a fundamental role in decision-making and the intentions behind a consumer’s purchase, thanks to brand awareness.

It is able to evoke stratified and complex associations within stakeholders, linked to types, preferences, strengths, and uniqueness, thanks to the brand image.

If we decide that CEO branding is one of our main tools of communication, all of these features and others we will see will be designed in a strategic way when planning the CEO’s contribution to corporate communication. Clearly, the theoretical framework of the brand is so broad and relevant that it is impossible to give an exhaustive account here. However, recalling some of its basics is useful in understanding how the implementation process of the CEO branding, despite being historically born from below, or rather from behavioral models tactically introduced into the communicative flow by CEOs themselves (often those who later become Superstar CEO’s), if wanted to be used effectively and efficiently in the company’s competitive strategy must now, on one hand, benefit from everything which has been understood and resolved about the brand, and, on the other, everything which the constant monitoring of the most attractive brands and their affirmation strategies have to offer⁹.

1.4The branding activity: a no-limits evolution

As has been known for over a century, branding in companies, understood not only in building a brand, but as a defense and support of the brand, is carried out by top management and therefore certainly also by CEOs. It started with the aim of using it to differentiate the product, but later during the 1980s, the focus widened to the entire organization, up to the creation of corporate branding which provides the adoption of a pan-company perspective, where the customer-centric vision expands to include all the stakeholders from which the organization depends. Thus, if product branding resided exquisitely in the dimension of customer marketing, corporate branding requires the involvement and commitment of the entire organization, from the CEO to the bottom line¹⁰.

In this way, corporate branding becomes, more than a marketing lever, a management philosophy. It must be treated as such and must give the following results:

Contribute to the corporate images of the organization that are perceived by all stakeholders, not just customers but employees, investors, suppliers, partners, legislators, municipalities, local authorities, and NGOs.

Provide a key endorsement, through a coherent and transparent projection of the corporate identity, of the involvement and identification of the same stakeholders.¹¹

Reach individual stakeholder groups in a targeted manner, balancing the corporate images for each of them.

With this same logic, the branding business can invest places, cities, human resources,¹² or specific individuals for which branding aims to build a personal brand.

The process of building personal branding can take place for any member of the organization at any level, from the entrepreneur to the employee, to the freelancer. The construction of an image that is positive, outstanding, and full of distinctive features to the point of being perceived as unique can, in fact, be beneficial and translatable firstly into a demonstration and later into an enrichment of one’s professional value, including on an individual level, both with peers and superiors, both in the current workplace and in the one it is aimed at.¹³

To summarize, we can say that among the countless descriptions of the process of personal branding developed over time, there are some common characteristics:

The strategic approach.

The person-centered view.

The desire to convey a positive and engaging image.

If this is the process, the result is a personal brand or the set of characteristics of an individual (attributes, values, beliefs etc.) represented with a true and symbolic narrative to establish a competitive advantage in the perception of the target audience.¹⁴ Ultimately, like all brands, even the personal brand is a promise.

1.5The concept of CEO branding between theory and practice

Regardless of age, regardless of position, regardless of the business we happen to be in, all of us need to understand the importance of branding. We are CEOs of our own companies: Me Inc. To be in business today, our most important job is to be head marketer for the brand called you.

Tom Peters

If the CEO branding is a personal branding activity centered on the CEO, and based on everything we have so far described in relation to the brand and the process of its construction with specific reference to the person, the key quality promised to the CEO brand is that it does not only relate to the resulting image from the combination of skills, values, and personality of the CEO himself, but to the overall figure which the person embodies, so much so that the CEO brand can be conceptualized as a multidimensional affective cognitive phenomenon, which therefore also requires multidimensional measurement scales¹⁵.

It is becoming clear that the potential for study and application of personal branding in general, and CEO branding in particular (a study and application to which this book tries to make a contribution) are certainly underestimated at the moment, and consequently underdeveloped than those of product branding and corporate branding. At the moment, this is surely not only pathological but also a clear source of business opportunities through the intangible assets for those in the company who decide to approach these processes strategically, shunning those superficial intentions that they want to see, for example in stellar reputational performance linked to the CEOs of some companies, only meteors destined to leave behind a media trail leading to rapid consumption and oblivion.

Corporate branding and CEO branding must necessarily be aligned, in a holistic and strategic vision of corporate communication. From a dynamic perspective, one or the other of the two brands may prevail, that of the CEO or the corporate one. The CEO can be at the top at a time when the company suffers a decline in popularity, or vice versa, the company may disclose a strategic maturity in its branding which the CEO has not yet arrived at with the branding of himself. What matters, however, is awareness by the organization that research of an alignment through analysis and appropriate corrections is essential, especially in an era where thinking about a brand and who manages it is now inevitable.

These practical evidences are wisely the symptom of the blossoming of numerous contemporary studies, related to the theme of this volume. Apart from those already mentioned, we would like to give a short space to what was probably the progenitor of these studies, at least for its purpose of wanting to provide a theoretical construct of the daily life of a real CEO: Almost half a century ago, in 1973, Henry Mintzberg published The Nature of Managerial Work,¹⁹,¹⁶ in which he represented the results of a research conducted on the observation of working behavior of five CEOs. Based on his observations, Mintzberg formulated 10 possible managerial roles in the volume and 13 propositions designed to define the characteristics of managerial work based on the theoretical assumption that it is the structural conditions that largely determine managerial behavior. For example, Mintzberg examined a week’s work of five American CEOs in profoundly different contexts (including the director of a hospital, the president of a manufacturing company, and the CEO of a consulting company). The observation led Mintzberg to outline behavioral patterns that are still considered reliable today, although outdated by recent studies which enrich and broaden the perspective with new models: A part of the CEO’s duties are involved with interpersonal relationships and includes legal and ceremonial duties (figurehead); another part is being devoted to motivating, challenging, and incentivizing the employee (Leader); while another creates links with the environment outside the organization (Liaison). Lastly, there is the monitor function, aimed at observing the company and collecting data from their personal network, organized in order to promote a better understanding of the dynamics of the organization, and so on with the functions of entrepreneur, spokesperson, resource allocator, and negotiator. These are all intuitively understandable and identifiable, even in the behavior of contemporary CEOs, whatever the size and turnover of the company they manage.

Mintzberg’s study¹⁷ had and still has the merit of having revealed the multifunctional and multifactorial components of the CEO figure, giving the initiation of specific studies on each of them, but most importantly to the study on how the CEO figure is indissoluble from the benefits that he can bring to the company that he directs. Therefore, the complexities of the CEO person must be evaluated not only in situations of risk such as failures, misunderstandings, or instability, but as an extraordinary opportunity to provide corporate communications with a multidimensional prospect. Fundamentally, Mintzberg’s study communicates the perspective of CEO branding embodying total business communication.¹⁸ This is done through interconnected methods of public objectives to be achieved and complementary tools, as each of the functions of a CEO is suitable for multiplying the results of single media exposure on different audiences. If discussions on the functions of the CEO from the time of Mintzberg have multiplied exponentially, that of CEO branding is, as we have already stated, at its very beginning. Yet the acceleration in the ways of relating to the stakeholders and the media exposure to which this function is subjected require ever more prompt answers and flexible models. It is worth mentioning at least a few current milestones in the literature on CEO branding.

It is not surprising that the CEO is a crucial factor for the success of a company, they are a vision builder who runs the company, gives it motivations, has specific duties toward it, is familiar with analyzing and determining the direction it must go in.¹⁹ The CEO applies management skills within their company and coordinates behavior in an adequate coherent manner, bringing their vision and ability of innovation.²⁰ The CEO is not only a vision setter, a motivator, an analyst, and a task manager,²¹ but is also the figure that knows how to take leadership in vision, strategy, financial politics, market orientation, goods and services, corporate culture to differentiate one’s own company from those in competition, and preserve the position of acquired strength.²² Therefore, we can now say that the personal brand of a CEO reflects their core values, passions, and skills, and that the branding of their leadership must reveal competence, standard, and style of a leader. Consequently, we can define a CEO’s personal brand as an individual representation of his personality, values, skills, and leadership that set him apart from other CEOs. A CEO’s personal brand will guide their decisions and will give them the ability to influence other people. Lastly, the personal brand of a CEO reflects the way in which people experience their own relationships with the CEO himself.²³ We can, therefore, consider the CEO brand a particular category of human brand, which qualifies in a unique manner as CEOs are subject to different needs of stakeholders. They are influenced by their role and identity as manager and are obliged to consider their relationship with the corporate brand.

1.5.1The Bendisch Model

In 2013, Bendisch²⁴ developed what is perhaps the largest conceptual models relating to the CEO brand to date: Understanding both in the perspective of the creator and the stakeholder the constitutive elements in the managerial and human aspects of the CEO, and its purpose in being an adequate tool, understanding which variables and with what mechanisms to constantly carry out a monitoring of the CEO’s reputation. As can be seen in Figure 1.1, the creator perspective refers to the CEO brand identity, where managerial and personal identity converge, while that of the stakeholder sees both of these projected in the CEO brand reputation. The alignment of these two perspectives contributes decisively to determining the positioning and equity of the CEO brand: From the combination of input CEO brand identity and output CEO brand reputation, CEO brand positioning is derived. This is essentially