There has been much media coverage about the Pew Internet and American Life Project research (12.16.07) on Americans googling themselves for what I call reptuation checkups. I felt that I could not ignore it since it falls into what I also call my reputation bucket (all things reputation-related).  Afterall, your “good name” is all we have.

Pew found that nearly one-half (47 percent) of Americans have searched for their own names to see whether they were receiving a thumbs up or thumbs down. This name-searching figure has dramatically doubled since 2002 when Pew found only 22 percent targeting themselves online.  I can’t say I blame them. I have searched my own name several times since reputation is my middle name (just kidding).  Interestingly, most Americans don’t search for their names online on a regular basis. Apparently they are not worried about what might be said about them. This bears out in the research — the majority (six out of ten Americans) are not worried about how much information is available about them online. I assume they believe they can manage their reputations well enough. Probably a mistake as privacy gets increasingly scarce.

Interesting tidbits in the Pew report include:

• Only 4 percent found disturbing or inaccurate information online associated with their name
• Most searches are innocuous — looking for someone’s contact info
• Those under 50 were more likely to be interested in their online reputations

As one of the co-author’s wrote: “Nostalgia seems to motivate quite a few Internet users. the most popular search target is someone from the past — an old friend, an old flame, or a former colleague.”

I imagine that name-searching is much higher among business executives who depend on their reputations for career opportunities and advancement and enhancing their own company reputations.  My guess is that the figure would be closer to 85 percent  vs. the 47 percent Pew found.  Either way, reputation checkups are important and will probably soar when Pew does its next research in 2012 (five years from now!).

We regularly get curious about things that happen in the communications and reputation space. Recently we were wondering if the frequency of “the company declined to comment” in the global media had risen or fallen in light of the intense media scrutiny that accompanies corporate crises and companies’ growing recognition of the need to be transparent.  My hypothesis, which was proven wrong, was that there had been a preciptious decline in “no comment” over the past several years. I based that assumption on the fact that “no comment” is increasingly perceived to be “guilty as read.” Instead no commentitis has risen steadily and although it has seen a few dips, remains standard operating procedure in the business world. Of course, every situation is different but reputations can be chipped over those two simple words.

An article in the Economist (December 1, 2007) writes about embattled British prime minister Gordon Brown: “Yet governments can reach a tipping point after which they find it impossible to govern. People neither like nor trust politicians, but usually suspend their disbelief when a new lot takes over. Once it seems clear that a prime minister is unlikely to improve things, and may not even be around for long, that suspension is over: the civil service starts leaking; cabinet ministers start briefing; the press looks for bad-news stories; and government becomes defensive and unfocused.”

Sounds to me alot like a CEO’s first year…research has shown that by about nine months, employees have a second sense that things will either work or not work with their new chief executive.  Proof again that those first three to six months for leaders can make or break their reputations. First impressions are very costly. No time to waste.

We just released our new findings on Global 500 CEO Departures. Just as it was released this week, I see the news that Motorola’s CEO Ed Zander stepped down. As I have noted many times, being CEO today is a treacherous job. The shelf life is short and reputations quickly tarnished. Here are some of the key findings.

• Over 10 percent of the world’s largest companies lost their CEOs in the first three quarters of 2007. This departure rate amounts to a CEO departure among the world’s largest-revenue producing companies nearly every 5 days.

Global CEO Turnover by Region: First Three Quarters 2006 vs. 2007
	2006		2007
Region	Total (#)	Percent (%)	Total (#)	Percent (%)
North America	16	8.7%	12	6.7%
Europe	17	9.3%	24	12.6%
Asia Pacific	19	15.5%	20	16.4%
Latin America	0	0%	1	10.0%
Total	52	10.4%	57	11.4%

2007 saw more chief executives exit during the first quarter than the following two quarters (26 vs. 15 vs. 16, respectively) and when compared to the first quarter of 2006 (26 vs. 16, respectively).   

Overall, 28 percent of chief executives who left office in the first three quarters of 2007 exited involuntarily. European CEOs were more likely to be pressured to leave their jobs than their regional counterparts.  While only two European CEOs were forced out of office by the end of the third quarter in 2006, nine European CEOs exited involuntarily during the same time period in 2007 – a 350 percent increase.  

Ousted Global CEOs By Region: First Three Quarters 2006 vs. 2007
	2006		2007
	Total (#)	Percent (%)	Total (#)	Percent (%)
North America	3	18.8%	3	25.0%
Europe	2	11.8%	9	37.5%
Asia Pacific	8	42.1%	4	20.0%
Latin America	0	0%	0	0%
Total	13	25.0%	16	28.0%

For the first three quarters of 2006 and 2007, insider executives continued to outnumber outsider executives when new CEOs were selected to lead the world’s largest companies.  Interestingly, 2007 had an even greater proportion of insider CEO successions than seen in 2006 (70 vs. 64 percent, respectively).

Some research has shown that people believe gossip, rumor and innuendo even if they are confronted with hard evidence refuting it.  Research conducted at the Max Planck Institute described in The New York Times and later mentioned in The Week (great to read) told about researchers who set up a situation where players who were playing a philantrophy game gave other players money based on a recipient’s rumored reputation. When the players were told that a recipient was generous and friendly to other players, they were much more likely to give money to that person. In contrast, when they were told that the recipient was greedy and unfriendly, players were less likely to give that person money. BUT this pattern remained the same even when people were shown written documents saying that the greedy person was actually quite generous and the generous person was actually Scrooge-like. Gossip and reputation-ruining information is obviously very sticky and trumps rational data.  A lesson to be learned. Watch your reputation since bad news is hard to erase, regardless of how much support you have saying you are being unfairly treated.

We just released some new research on company reputation. This is a subject that I have always been very interested in. Considering the daily headlines about quality problems with products made in China, this research is very timely.  This is what we learned about managing country reputation — it is alot harder than you may think. 

Leading a large multinational company might be a complex and challenging task, but global business leaders believe that heads of state have a much tougher job than they do when it comes to managing reputation.  When asked which is harder to manage — a country’s or a company’s reputation — executives chose country reputation more than twice as often (68 vs. 29 percent respectively).  Our survey, Safeguarding Reputation™, was conducted in 11 worldwide markets in partnership with KRC Research.

In a challenging sociopolitical global environment, business leaders clearly recognize that managing a country’s reputation or brand is complex and subject to many external forces. Recent problems with manufacturing in China, news about terrorist breeding grounds in Pakistan and U.S. government efforts to improve its reputation internationally show how difficult it is to effectively manage country brands today.  By comparison, managing a corporate reputation looks tame to senior business people.

Not All Types of Reputations Are Managed Equally
Global business executives agree that when it comes to managing perception, some industry and publicly held company reputations are more difficult to oversee than others, while managing an individual’s reputation is considered easier than both according to business executives.

• An industry’s reputation is perceived to be harder to manage than a company’s reputation — approximately one-and-one-half times more difficult (57 vs. 39 percent, respectively).  Interestingly, executives in Italy differ from most of their regional peers and consider a company’s reputation harder to manage than an industry’s reputation (54 vs. 30 percent, respectively).

• Publicly held company reputation is considered much more difficult to manage well than privately held company reputation — nearly three times more difficult according to global business executives (71 vs. 24 percent, respectively).  North American executives, compared to those in Europe and Asia, were the most likely to agree with this finding (82 percent vs. 63 percent vs. 76 percent, respectively).

• Company reputation is nearly four times more difficult to manage than individual reputation (77 vs. 21 percent, respectively).  

Back to the difficulties in managing country reputation. A recent article in The New York Times, “China Steps Up Efforts to Cleanse Reputation,” described China’s efforts to improve its tarnished reputation after much publicized recalls of Chinese-made products such as toothpaste, tires, toys and pet food. The article said that Chinese officials have engaged in the following activities in their all-out public relations offensive: held news conferences on food and product safety, were apologetic in conversations with Western officials, offered tours to international media of government safety labs, initiated a new recall system and nationwide inspection of various industry operations, and added labels to food packaging indicating that the contents were safe. As quoted in the article, a high-ranking Chinese official said: “This is a special war to protect the safety and interests of the general public, as well as a war to safeguard the ‘Made in China’ label and the country’s image.”

Chinese officials have not just turned the other cheek. They have argued with critics about the safety of their products and have publicized that other countries too have had trouble with exports. Clearly, the Made in China reputation is being taken seriously and the country’s global communications campaign is in high gear.  China is intends to recover its reputation as the Summer Olympics in Beijing approaches next year. The country even launched a special broadcast on its largest state-run network called “Believe in Made in China.”

Without a doubt, country reputation is hard to manage well. And as hard as it is to admit, much harder than managing company reputation. For those of us living in the U.S., we understand very well how it feels to lose reputational standing around the world. Someone has to take charge.

The Wall Street Journal had an illuminating article yesterday about how the private lives of CEOs impact share price and performance. Let me list the reported results first and then tell you what I think.

• CEOs with large homes run companies that perform more poorly after the purchase. NYU professor David Yermack measured the square footage of CEO homes to arrive at this finding. The rationale for stock erosion subsequent to buying the home is that it brings additional responsibilities such as gardening, more time spent enjoying the mansion and I guess admiring the view.
• CEOs who lose a child, spouse or significant other (the exception being a mother-in-law) are more likely to be distracted and see stock performance suffer. This survey was conducted by Professors at Copenhagen Business School, NYU and the University of Texas.
• CEOs who are narcissists take greater risks resulting in greater fluctuations in company profitability. Narcissism was calculated by assessing CEO photo size in annual reports and frequency of first person singular in media interviews. The study was conducted by Professors Arijit Chatterjee and Donald Hambrick.

Clearly, life events affect CEOs and this impacts company performance. And yes, this information matters deeply to investors.  And yes, this information all points to the importance of CEOs which is continually debated (not sure why?).

After studying and researching CEOs for many years now, I was distressed to see how much time and energy went into examining these personal details of a CEO’s life. Here is what I learned about how Professors Yermack and Crocker Liu of Arizona State University went about their research on big CEOs’ big homes: “Prof. Yermack and Crocker Liu of Arizona State University set out to find real-estate records on the CEOs who were running all of the S&P 500 companies at the end of 2004. They scoured electronic records of taxes and deed transfers. When they couldn’t find a home address, they turned to databases on voter registration rolls and campaign contributions. Eventually they found the addresses of 488 of the 500 executives.” They also made good use of aerial photographs now on the Internet to determine if CEOs had swimming pools, tennis courts, boathouses and other luxuries (surely hot tubs!). Shouldnt university professors be examining how to build successful companies? The research reported above takes many many hours to conduct.

The research I have conducted at Weber Shandwick found that CEOs are indeed important to company reputations. When I checked last night, nearly 3,000 readers who responded to the WSJ’s poll on whether CEOs matter seem to agree: 54% said CEOs are very important, 33% said moderately important and only 14% said they were not important. This finding is close to what my research has shown over the years. If you want to learn more about why CEO reputation matters, please read my book (CEO Capital: A Guide to Building CEO Reputation and Company Success). This should not be such a mystery. We may wish CEOs did not matter but they sure do.