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A study released on Friday identifies a strong correlation between a company's corporate communications organisation and the company's ranking on Fortune magazine's "World's Most Admired Companies" list.
Specifically, the study finds that the professional background, communications priorities, and inter-organisational relationships of the executive who leads the company's corporate communications department - commonly referred to as the Chief Communications Officer (CCO) - are all meaningful indicators of the ability of the department to make a positive impact on a company's reputation.
The survey, The Rising CCO, compares responses from communications officers in the "world's most admired companies" with those in "contender companies" (generally, most admired companies are the most highly ranked companies in an industry on overall reputation; contender companies are ranked in the industry's bottom half). The 141 survey participants were top corporate communications executives from Fortune 500 companies in the U.S. and Europe.
The survey, which was conducted by global executive search firm Spencer Stuart and global public relations firm Weber Shandwick with KRC Research, examines the changing role of today's CCO.
"In a fast-paced and dynamic business environment, communications officers are increasingly seen as business partners for the CEOs and leadership teams, in the stewardship of a company's reputation," said George Jamison, Corporate Communications Practice Leader at Spencer Stuart. "CCOs are expected to create value and mitigate risks for the corporation by developing innovative strategies to proactively communicate with a company's myriad stakeholders."
The research found that communications executives in the world's most highly regarded companies have more prominent organisational status and longer tenures than their counterparts in contender companies.
Additionally, approximately one-third of CCOs from the most admired companies cite corporate reputation as their number one priority for 2008, compared to fewer than one-quarter of CCOs from contender companies (34 vs. 21 per cent, respectively). Contender company communications executives said they were spending more time working on product-related issues and crisis communications, while most admired CCOs said they spent more time on corporate social responsibility and building corporate reputation.
Other key findings are:
CCOs' responsibilities will increasingly shift from tactical to strategic. While CCOs are carving out their role as strategic partners at the highest levels of business, they today view work as predominately tactical (58 per cent tactical, 42 per cent strategic). This imbalance, as reported by those surveyed, is sure to change as focus shifts from financial communications, media relations and internal communications to the broader strategic issues of environmental/social responsibility and corporate reputation. The tools used to perform their jobs will expand as well, with blogging/social media and corporate web sites becoming increasingly important.
CCOs hold prominent positions at the world's largest companies. Nearly one-half surveyed report directly to the chief executive officer (48 per cent) and are visible to their boards (had a median seven interaction with their board during the past year).
CCOs and CMOs are friends and rivals. CCOs' dynamic relationship with chief marketing officers - often a main rival and ally - reflects the growing influence of communications in today's marketing mix.
Measurement of CCO effectiveness is predominately qualitative. The vast majority of those surveyed report being measured on qualitative measures such as "positive" media coverage (75 per cent) and CEOs' "gut" feel (73 per cent). They are least likely to be measured by quantitative metrics such as the number of media mentions (35 per cent) and ability to control costs (32 per cent).