Which is the world’s most valuable brand?
According to the 2019 Brand Finance Global 500 report, launched in partnership with Tata Consultancy Services (TCS) at the World Economic Forum Annual Meeting in Davos, Amazon is the most valuable brand in the world.
The report takes annual stock of the world’s brands across all sectors and countries, taking into account how much financial value has been created as well as indicators on their reputation.
Amazon tops the list, growing nearly 25% to an impressive US$187.9 billion this year. Apple and Google are placed 2nd and 3rd respectively.
The report also spots the key trends in brands. In recent years, the most notable trend has been the increasingly important role that the c-suite now plays in safeguarding and maintaining the brand of their company. And getting this right really matters.
Huge investments are made in the design, launch, and ongoing promotion of brands, and for good reason. According to Brand Finance CEO, David Haigh, the value of intangible assets, such as brand strength, is around 60% of global stock-market valuations. In absolute terms, that’s around $55 trillion.
Brand Finance research also concluded that investing in highly-branded companies would lead to a return of almost double the S&P 500 average. Not only that, the cost of capital for those highly-branded companies is lower.
Speaking at the launch of the report at the TCS Dome at Davos, an expert panel of CEOs debated this critical role that the CEO now holds.
Kylie Wright-Ford, CEO of Reputation Institute, said that there had never been a more important time for this key discussion to take place.
“It is a precarious time. This time one year ago, in January 2018, 132 CEOs left their posts, some of them under very difficult conditions, eight of them under transgressions. 10 left under difficult circumstances and 21 were replaced by their boards. It is a very difficult time and that is the highest movement in CEOs that we have seen for eight years.”
CEOs have to get out in front of their brands, she added: “This is not a time for your CEO to be sitting back. It is a time to be vocal; a time to be out there.”
Natarajan Chandrasekaran, Chairman of TATA Sons, said that there were three key elements to consider regarding the role of the CEO.
“First and foremost, transparency and trust is the foundation without which you cannot even think about building a reputation.
“Secondly, why is it so important today? It is because today everybody is connected. Billions of people get to know what you think and what happens to your company; what happens to you; what is your point of view; all instantaneously. It is very important for CEOs to have clarity on issues that are core to their business, the purpose of the business and its mission statement.
“Thirdly, does your company walk the talk? You can be a spokesperson, but in this situation the walk should be happening along with the talk, or sometimes ahead of the talk. Otherwise, you will get a negative reputation.”
Company vs personal view
But there can be conflict between a CEO’s personal view and that taken by the company. In addition, too much of a stance in any direction could have a polarising, rather than a unifying effect.
The stakes are high, said Cathy Bessant, Chief Operations and Technology Officer at Bank of America, because in the minds of the public, the personal views of the c-suite are taken as synonymous with those of the company.
While taking a stand and showing citizenship was important, Bessant cautioned that there were key areas to be avoided.
“Politics is a dangerous place to be making a stand unless you are really sure that it aligns with your values. But don’t confuse this with governance, taking a stand on things is important.”
Chandrasekaran added that we had to make a distinction between a view being based on values or business.
“On the business view, the CEO’s view most of the time is the company view. That is the leadership that everybody is looking for from the CEO. Sometimes the CEO has to take a view and has the job of communicating with everybody, to rally the troops and get them on board.
“If you cannot match the value systems of the company, then you’re in the wrong company.”
Jonas Prising, CEO of ManpowerGroup, agreed, saying that the CEO also had the responsibility to embed those views in the culture of the company.
“The strength of the culture, what you stand for, that is a position that you take as a company. That you are a place where your employees can come and feel good about the purpose of the company is increasingly important, because it will be reflected in their interactions with clients and associates.”
But Prising also warned that if CEOs take a view which only speaks to a certain part of the community, they run the risk of polarizing their brand.”
Bessant said that silence was often underrated, and that CEOs should have a unifying, not polarizing role.
The journey towards brand strength
It’s a cliché to say that it takes 20 years to build a reputation and five minutes to ruin it. But that cliché is true.
Concluding their views, the panel agreed that CEOs had to embrace the celebrity and guardianship of their brand. Their stance had to be genuine and authentic, they had to inspire trust and communicate transparently, and above all, have empathy and an understanding of their role as the representative of all stakeholders.
Chandrasekaran said that the path to brand strength was a long one, but a worthy one.
“It takes years to gain trust, then it becomes valuable, then the company gets respected and finally, revered, that to me is a journey.
“If you are going to be on that track it requires consistent behaviour and high commitment to the character of the firm’s leaders and the behaviour of the firm.
“It’s not about whether a company is valued too much today or tomorrow, if you want to create an iconic company, it’s a long-term path.”