CEO Rule #5 : You Make The Brand Work. You Must Be a Virtuoso.

The JLC Group firm ‘slogan’ “We Connect the Tag Line to the Bottom Line” is intended to be an all-purpose metaphor for the role we play when working with corporate executives and leading entrepreneurs. In the parlance of one of our more well-recognized financial industry clients,  we’re a “multi-asset specialist” and we often deploy a tactical, multi-strategy approach to increasing a client’s ‘Alpha’ aka return on assets without exposing the client to uncorrectable risk.

For those less familiar with financial service industry vernacular, our practice areas include  a tight cross-section of capabilities:  marketing/communication, public relations, as well as strategic partnerships, branding tactics, advertising schemes and sales strategies. As such, in many engagements we inevitably find ourselves serving as a “CEO Consigliere.”

Our role is therefore not merely to use our creative thinking skills to leverage a snappy slogan via branding schemes that produce profits, but more important, and much like a ‘real’  Consigliere, our job is to objectively assimilate the value proposition of the enterprise and help the leadership of that concern connect the spirit of the company’s products, services and culture –i.e. the company’s assets, to help make that enterprise more profitable.

Because this writer has served stints as CEO of a public company as well as one or two private companies, (and in an earlier life, reported directly to the CEO in various other jobs),  I still find myself connected to thought leaders with similar titles, and because most engagements have The JLC Group working directly with the client firm’s CEO or CMO, we were struck by the title of recent study published in this month’s Harvard Review, “Measuring the Return on Character” and conducted by leadership consultant KRW International. Maybe it was the “Return on..” that caught my attention, but I’m glad it did. The study is a good read for any executive that aspires to innovate and profit accordingly. Or perhaps an even better read for a  leader who has lost his path to bottom line profitability. Here’s why:

To frame the KRW findings (authored by Fred Kiel), the research focuses on the personal characteristics of corporate CEOs and respective bottom line performance. Leaders were broken down into 2 simple categories,  one being “Virtuoso CEOs”— leaders frequently engaged in behaviors that reveal strong character—for instance, standing up for what’s right, expressing concern for the common good, letting go of mistakes (their own and others’), and showing empathy. And, there are “Self-focused CEOs”—warping the truth for personal gain and caring mostly about themselves and their own financial security, no matter the cost to others.

As expertly underscored in the above recent-noted study, researchers found that CEOs whose employees gave them high marks for character had an average return on assets of 9.35% over a two-year period. That’s nearly five times as much as what those with low character ratings had; their ROA averaged only 1.93%.

In addition to outperforming the self-focused CEOs on financial metrics, the virtuosos received higher employee ratings for vision and strategy, focus, accountability, and executive team character.

When asked to rate themselves on the four moral principles, the self-focused CEOs gave themselves much higher marks than their employees did. (The CEOs who got high ratings from employees actually gave themselves slightly lower scores—a sign of their humility and further evidence of strong character.) The take away: Leaders can increase their self-awareness through objective feedback from the people they live and work with. But they have to be receptive to that feedback, and those with the biggest character deficiencies tend to be in denial.

How can such leaders get past their denial and overcome their character deficits? Seeking guidance from trusted mentors and advisers helps a great deal.

That said, according to the article, character isn’t just something you’re born with. You can cultivate it and continue to hone it as you lead, act, and decide. The people who work for you will benefit from the tone you set. And now there’s evidence that your company will too. Read the entire story via this month’s Harvard Review,

Learn more about KRW’s findings in Return on Character, by Fred Kiel (Harvard Business Review Press, 2015).

CEO Rule #5 : You Make The Brand Work. You Must Be a Virtuoso.