As an example of the power leaders’ words have to adversely affect their own business’s performance, you’d be hard pressed to find a better example than Elon Musk’s recent notorious earnings call. In dismissing analyst questions as “boring” and “boneheaded”, and later urging that some investors “Don’t buy our stock”, Musk managed to set Tesla stocks tumbling, closing 5 per cent down, with around $2.8 billion wiped off its market value.
This is nothing to be sniffed at for any company. And certainly not at a one that was, in the very same call, attempting to portray a positive impression of its car-making credentials at a time when production figures and profitability are still major concerns for some of its investors.
This story went around the world in almost no time at all and managed to eclipse reports of the actual results and forecasts that the call had really been about. This isn’t surprising, of course. For one thing, this call hosted a large number of journalists, so the story was hardly going to remain quiet for long.
And for another, it is hardly the first time that Musk has made public statements and decisions that would raise the alarm of even the most cynical of corporate public relations people. Whether it’s robustly responding to lethal Tesla crashes or announcing the sale of flame-throwers, Musk has not been shy about making statements that are way outside the norm for CEO communications.
For Musk, this may well fit with his investor allure — a real life Tony Stark who wants to fly us all to Mars. But for most CEOs, the concerns of public relations are rarely ones that can be shaken off so lightly. CEOs are the figurehead for their whole business.
The way they talk to the media, to investors, to their customers, is crucial to the way these different stakeholders relate to a company. For better or worse, people will very often make an indelible link between the words and actions of a leader with the direction and standing of the company they lead.
While this is generally accepted by many CEOs, many corporate leaders can still treat their public-facing role as an arms-length concern. They believe they have “people” to manage the issue, and so will engage with it only as and when they deem absolutely necessary.
While it is certainly true that CEOs have many other things to think about, it is unwise for them to shift all of the responsibility for public relations on to others. Ultimately, their pivotal role as spokesperson and figurehead means they need to be personally invested in setting the tone and direction of how they present themselves publicly.
In practice, this will mean being open to public relations training aimed at practicing answering media questions with thought and precision. It will mean engaging with interviews and public speaking opportunities with commitment and active participation. It will mean being guarded, cautious and, necessarily, diplomatic if a stakeholder asks a question you dislike.
There is a cynical aspect to this, of course. Being publicly impressive as a leader isn’t necessarily the same as being actually impressive. It is certainly possible that even the most positive of public faces might hide poor business practices and corporate problems.
Overcoming this cynicism comes from making the commitment to always lead authentically — committed to your own values, presenting publicly what you believe in private. If the public and private leader are one and the same, it is far easier for stakeholders to “buy-in” to the image a leader portrays.
Few CEOs have the comparative luxury of Musk’s unique standing in the corporate world. Conduct that might be considered delightfully eccentric or impressively forthright from him is likely to be viewed rather more gravely from CEOs who don’t bring his unique combination of pop-culture appeal and immense personal wealth.
Instead, a more mundane — but arguably more constructive — approach is likely to be needed. This will consist of a commitment to a presenting a positive public image, hopefully springing from a place of true authenticity to the leader’s personal values.
Ahmad Badr is CEO for Knowledge Group.
