The article in yesterday’s WSJ (7-12-06, A Tale of Two CEOs) about two distinctive CEO reputations — Bob Nardelli at Home Depot and Jeff Immelt at GE — was compelling. Not surprising, it was the fifth most frequently emailed article. The page two feature by Alan Murray succintly made the case for how reputations get made today. Two adages apply — “financial performance is necessary but not sufficient” and “perception is reality.” Despite both CEO’s inability to lift share price, Immelt is more highly regarded than Nardelli due to his accessibility, willingness to engage critics, his pay for performance and his drive to make GE a responsible citizen. Here is the quote that says it all to me about expectations for 21st century CEOs:
Success and failure are no longer a simple matter of shareholder returns. For better or worse, it is a much more public game, involving a wide range of constituencies and requiring the skills of a politician.
Being CEO today is much like being a politician. You have to win the vote every day.
CEO reputation, GE, Home Depot, Jeff Immelt, Bob Nardelli, Alan Murray, Wall Street Journal, accessibility, pay for performance, corporate citizen, perception is reality, CEO as politican