Montieth Illingworth
Montieth Illingworth

Are CEOs lonely? That’s not a common question.

Undoubtedly, if a CEO is asked that question for the purposes of public consumption, the answer would almost certainly be no. CEOs will almost always say the job can be challenging, that meeting those challenges is its own reward—part of achieving the overall corporate mission on the march along the strategic journey.

But lonely moments can occur, even though the leadership experience will rarely be defined as such in the corporate setting. For communications executives, it’s sometimes valuable to put that lens on a range of critical issues and crises that involve the CEO. The resulting insights are useful in figuring out how to advise not just the CEO but also the Board of Directors in these situations, as well as managing stakeholder relationships, and protecting the corporate reputation.

What defines a lonely moment for a CEO?

Examples abound. These include the surfacing of information, about which the CEO knew or should have known, that proves to be materially damaging to the company. For instance, a significant financial loss, whether because of poor performance or—worse—some kind of fraud.

Once public, the CEO is expected to explain what was known, when and how. Also, while providing the full timeline of what occurred, from origins to revelation, there needs to be an acknowledgement of what should have been publicly disclosed, in whole or in part, especially to stakeholders (i.e., investors) directly damaged by the material losses.

Professional vs. Personal Responsibility

The lonely part for the CEO is the struggle over how much personal and professional responsibility to shoulder for what happened. The difference between these types of responsibility is key.

The professional part is a kind of calculus that if the event wasn’t a direct result of the CEO’s decisions, she will parse out the bits she’s responsible for from those she is not. That’s a seemingly reasonable approach and it often involves conducting an independent investigation and assigning responsibility across a matrix of parties, internal and sometimes external, to the organization.

Then there’s personal responsibility. Think of this as an ethical equation wherein total responsibility is taken by the CEO regardless of what was known and when because, well, that’s the right thing to do. Even if the CEO’s own decisions didn’t directly “cause” the losses, they were on his watch, and the act of taking responsibility sends a powerful message to stakeholders. At the same time, it isolates the CEO in a way that can only be called lonely.

Central to these decisions is which one, professional or personal, does the most to protect the integrity of the office of the CEO and thus the confidence in its high functioning? And which one conveys most persuasively to stakeholders that leadership and the mechanism of corporate governance (both the C-Suite and the Board) is truly solving the problem and not gaming the situation to save face?

A Balanced Approach

The answer to that question is that there is no perfect answer in most cases. There are often almost as many risks in the process of solving a problem as there were in what caused it in the first place. That dynamic causes many organizations to parse out every decision and action they take to address the problem, in hopes of avoiding too much attention and criticism.

In the end, though, it will almost always be a combination of the two scenarios— professional and personal— that achieves the optimal reputational outcomes. It’s just as important to find out what the CEO knew and when he knew it as it is for the company to take actions that are credible on their face—acknowledging errors, if they were made, assigning responsibility to all concerned, and of course fixing the problem.

Communicating those complexities is a challenge all on its own. Here, though, transparency and ownership—as in owning up to mistakes—are key driving principles and practices. That is how trust is built with stakeholders in these situations.

Another category, and by far the most complex, is where the personal and the professional collide. The convention is that the two are seen as existing in separate universes. Convergences, though, can happen and that occurs on a spectrum of risks for the reputation of the CEO and that of the organization.

While an accusation or potential for an indictment is not an admission or conviction, the circumstances nevertheless require the CEO to explain the conduct. And this as well has to be addressed as an issue of corporate governance for the Board.

Information Wants to Be Free: Enter the Board

Such incidents become public in one way or another and it’s key that the Board acknowledge that looming reality. As was said in the early days of the Internet, “information wants to be free.” When we flash forward to the role social media now plays in how people communicate, express opinion, and shape perceptions, the saying can be updated to “information doesn’t like it but once free it will be fuel for extreme views.”

There are few things lonelier for the CEO than having to explain such conduct to the Board, to colleagues and to the company as a whole. There’s also the possibility that the CEO’s actions breached his employment agreement. The key question here is whether it’s the responsibility of the company to pass judgement in some way about the CEO’s personal conduct.

It’s Not About Saving the CEO

None of this is easy. Every incident has its own circumstances and Boards vary greatly in their willingness and ability to deal with the full set of complexities. But it is the duty of corporate leadership, and the Board, to grapple with the lonely moments the CEO can be in and consider the reputational fallout. It’s not the Board’s job to “save” the CEO from himself. But it is it’s duty to make sure the office of the CEO is seen by all stakeholders as one that fulfills its responsibilities—professionally and yes, sometimes personally as well.

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Montieth Illingworth is CEO of Montieth & Company.