Editor's Introduction
Two things landed this week, both about how a chief executive is judged. The Financial Times launched a CEO performance ranking, an interactive tool covering one-year shareholder return, total shareholder return relative to the FTSE 100 across a chief executive's tenure, and employee satisfaction, letting the reader decide how much each measure counts. FTI Consulting also published research with 300 institutional investors asking the question: ‘how much of a company's value do they attribute to the reputation of the people running it?’
The FT exercise measures what a chief executive has delivered. The FTI research measures what investors believe about the person delivering it. The second is larger than most boards would assume, and it moves considerably faster.
Reputation has always been described as an asset. It has rarely been described as a priced one.
What the Investors Said
The headline findings from Executive Reputation: Priced, Prized, and Easily Lost:
56% attribute 30% or more of a FTSE 100 company's market valuation to the reputation of its executive leadership team. 71% put it at a quarter or higher.
For a mid-table FTSE 100 company, a quarter of valuation is billions of pounds sitting on the reputational standing of perhaps eight people.
76% would consider paying a valuation premium for a company led by a highly trusted and credible team.
Reputation is usually discussed defensively, as something to protect. Three quarters of the investors surveyed treat it as something they will pay extra for. That reframes the entire conversation. It is not insurance. It is a return.
88% expect company value to fall when a CEO is caught in a personal conduct controversy, even when the business is still performing strongly.
This is the number that matters most, and it is the one least acted on. The clause "even if the business is still performing strongly" removes the defence that most executives privately rely on: that results will carry them through. Investors say plainly that they will not.
23% rank executive reputation as the most volatile asset a company owns, ahead of any tangible or technical asset.
Almost a quarter of institutional investors consider the reputation of a handful of individuals more volatile than plant, inventory, intellectual property or technology stack. Those assets are insured, audited, depreciated and assigned to a named owner inside the business. Executive reputation is not.
The Analysis
The asset with no owner. Corporate reputation has a function attached to it. There is a communications director, an agency, a crisis retainer, a media policy. Executive reputation sits in an awkward gap: too personal for the corporate affairs team to own outright, too consequential to the share price to be left to the individual. Therefore, in practice it is managed by nobody until the moment it needs managing, which is the moment it cannot be.
Personal conduct is now priced separately from business results. The 88% figure describes a market that has stopped treating the executive and the enterprise as separable. A strong quarter does not neutralise a personal conduct issue. Boards that plan on the assumption it does are planning against the stated view of nearly nine in ten of the investors who hold their stock.
Volatility cuts upward as well as downward. The 76% premium finding is the constructive half of the same coin. An asset that can reprice sharply downward can also carry a premium when it is in good order. Very few executive teams are positioned to collect that premium, because very few have ever treated their own public record as something to be built deliberately rather than something that accumulates.
The repricing happens where the research is done. Investors do not form a view of a chief executive from the FT alone. They search the name. Increasingly they ask a model. What returns on the first page of search results, and what an AI system summarises when asked who this person is, has become the working record. A single episode that ranks well and gets absorbed into machine-generated summaries will be quoted back for years, long after the coverage cycle has ended and regardless of what followed it. The lag between an event and its long-term valuation cost is now measured in how durably it indexes, not in how long it stayed in the news.
What the research is. It records what 300 investors say they would do, which is not the same as what they do when a position is actually in front of them. Stated preference tends to run ahead of revealed preference in survey research of this kind, and a respondent asked directly about reputation is unlikely to say it does not matter. The honest reading is that the direction is reliable and the magnitude is indicative. That is still more than the sector has had before, and it is consistent with what we see after executive departures, where the share price moves before anything changes in trading performance.
The Pavesen Perspective: The Unowned Asset
The uncomfortable conclusion from this research is not that executive reputation is valuable. Everyone senior already believes that in the abstract. It is that a material share of market valuation now rests on something that has no owner, no measurement, no maintenance schedule and no reporting line.
Companies audit everything that carries this much value. Estates, cyber posture, supply chains, counterparties, insurance cover. The one asset that a quarter of investors call the most volatile the company owns is typically assessed for the first time in the forty-eight hours after it has already moved.
An assessment before the event is a different exercise entirely, focusing on:
Presence: what ranks for the names of the people who carry this valuation, across search and across the AI platforms now used to answer questions about them.
Perception: how that material reads to an investor, a counterparty or a journalist encountering it as part of their due diligence and research.
Exposure: what is sitting in data broker records, archived filings, old coverage and adjacent litigation that has not yet surfaced but would if someone went looking.
The purpose is not to remove anything. It is to know, in advance and in detail, what the market is looking at when it forms the view that 88% of those investors describe. A career built over decades should not be defined by a single episode, and the difference between those two outcomes is usually made in the period before anyone is watching.
The Pavesen Audit covers presence, perception and exposure, and is the first step in every mandate we take.
Source: FTI Consulting Strategic Communications, Executive Reputation: Priced, Prized, and Easily Lost, research with 300 institutional investors.