Leadership Impact on Market Value: The Role of CEO Confidence in Shaping Business Worthiness
Meet Lynn Smith, CEO of Lynn Smith Media & Communications, an advisor, coach, speaker, and former news anchor for TODAY, NBC, and CNN Headline News. Let's delve into the power of CEO confidence, a game-changer that influences investors, customers, and markets.
According to FTI Consulting, a confident CEO can significantly impact a company's valuation. During COVID-19, when the world was in chaos, confident vocal leaders like CEOs played a crucial role in steady the ship. FTI's research shows these leaders added $260 billion in shareholder value.
What made these leaders stand out? They didn't just spout numbers; they spoke about what mattered, from employee well-being to global challenges. Leaders who leaned into ESG issues and stakeholder capitalism performed even better, outperforming their peers by an average of 3.75%.
In the early days of COVID-19, a CEO I guided was struggling with uncertainty. We crafted a message acknowledging this uncertainty, emphasizing the leadership's ability to navigate it. The body language was just as essential as the message. Only 7% of your message's impact comes from words, according to Albert Mehrabian. Body language and tone make up the rest, 38% and 55%, respectively.
Confident CEOs drive 81% of the fastest-growing companies globally over a five-year period, regardless of market conditions. Building CEO confidence requires the three Ps: preparation, purpose, and promise. Preparation means being ready, purpose involves having a clear sense of why, and a promise ensures focus and a commitment to working on the big stuff.
The research highlights the correlation between vocal leadership and valuation. However, it's essential to note that confidence isn't innate; it's a skill that can be honed. With the right guidance, any CEO can amplify their impact and drive lasting success.
Lynn Smith, being the CEO of Lynn Smith Media & Communications, showcases confidence that is instrumental in influencing various stakeholders. FTI Consulting's research highlights that confident CEOs, like Lynn Smith, can significantly boost a company's valuation. Following the FTI's guidance, a CEO I worked with managed to navigate uncertainty during COVID-19, recovering and even outperforming their peers.
