The Changing Role of the CEO

July 01, 2020
By iQ Staff
Stylized businesswoman with clipboard leading a group of colleagues in an urban setting.

When millions of protesters took to the streets following the deaths of George Floyd, Breonna Taylor, Ahmaud Arbery and countless others, brands took to social media. Within days, companies large and small, some with a history of commenting on social issues and many without, shared statements declaring their commitment to racial justice and equity.

The dominant trend toward taking a stand, rather than remaining silent, highlights the growing importance of a purpose-driven approach to business. This approach, which has become more and more common over the past decade, allows consumers to align themselves with companies that share their values and leverage their purchasing power to effect change on a global scale.

The importance of the purpose-driven CEO has emerged as leaders are being called to the forefront in unprecedented ways to address the global pandemic and social unrest. Today’s CEOs need to make their presence known beyond the boardroom, in the communities where their companies operate and where their customers live.

Here are just a few ways the role of the CEO is changing, and how leaders can adapt.

 

Incorporating a global perspective

Never has a global perspective been more important than with the current crisis. It is no longer enough for CEOs to remain hidden in the background, quietly working away or simply releasing quarterly statements. Leading through action and facing key issues head on will continue to be the norm in the post-pandemic world.

At the 2020 World Economic Forum in Davos, Switzerland, leaders discussed how stakeholder capitalism could solve the world’s most urgent challenges. The forum issued a call to action for global business leaders to consider a more balanced form of capitalism — one in which companies invest in workers while taking care of their customers, communities and the planet.

In a recent U.S.-based survey, 95% of respondents reported wanting large corporations to promote an economy that serves all Americans. Fair wages, ethical leadership and work-life balance all emerged as top priorities. Based on the survey results, it seems that leaders who look to address the public’s priorities will likely fare better in the long run than those who focus on the unsustainable practice of increasing their profits above all else.

 

Get involved at every level

Businesses have shown that doing good in the community can be good for business, whether it involves investing in training for women, ethnic minorities and veterans, or supporting customers and small businesses through periods of adversity.

As CEOs manage shared risks and create shared value for all stakeholders, they need to keep their leadership team in mind. They are the ones representing brands at an internal and external level — from HR leaders meeting with employees to customer-facing managers who are the company’s face to the world. As strategic plans are rewritten to reflect the current reality, CEOs are tasked with creating a solid foundation based on their company’s values and vision so they can clearly guide their team through uncharted waters while staying agile and inventive.

At a time when innovation and creative thinking are necessities, CEOs will also need to stay close to their teams and create an environment where all staff can contribute new ideas and ways of thinking. Effective leaders can arm their management teams with the right training to be company stewards and ambassadors.

 

Lead the conversation

Resilient leaders are transparent and open about the realities we’re all facing, but at the same time, they pave the way toward solutions that are strategic, creative and compelling. Their authenticity and ability to inspire hope can encourage those around them to persevere. Now is the time for CEOs to explore ways to ensure compassion and humanity are a part of business, not just an afterthought.

By training leadership teams and providing a clear, purposeful narrative, CEOs can avoid the spread of misinformation or misperceptions among key stakeholders and the public. Consistent messaging and the right cadence are paramount to building trust.

Leading the narrative on social media channels is no longer enough. Brand narratives should be followed by aligned actions that help to acknowledge shared fears while framing opportunities that can be explored together.

Another way CEOs can lead the conversation is by demonstrating that they and their  company understand and support their employees’ needs. Companies that offer strong employee benefits or acknowledge racial disparity show they have a clear sense of purpose, which will continue to be important in the coming years.

 

Driven by purpose

The public’s trust in corporations ebbs and flows, often based on an organization’s visibility and actions. Pre-pandemic, CEOs were viewed as more trustworthy than governments. In the wake of the pandemic, members of the public have looked to their state and local government entities for guidance while simultaneously displaying increased skepticism toward businesses and their CEOs.

In the midst of this crisis, there lies an opportunity to dig deep, reassess, clarify and align. Leaders have a chance to rebuild trust and be of service in a way that is palpable and meaningful for everyone involved.

In a recent interview, when Unilever CEO Alan Jope was asked if the current crises would prompt him to change his ways, he responded:

“Our company is guided by three deeply held beliefs: that brands with purpose grow, companies with purpose last, and people with purpose thrive. And we think that refrain is going to be even more relevant in a post-coronavirus world than in a pre-coronavirus world. So we will not waver one iota in our commitment to purpose-led business.”

Jope’s response reinforces the idea that strong, purpose-driven leadership drives long-term success. As the role of the CEO continues to shift, leaders must keep asking themselves what role their companies play, and ultimately, what values are guiding their decisions.