CEO Corporate Reputation Jeanette Dyhre Kvisvik Manager

CEO & Corporate Reputation Jeanette Dyhre Kvisvik Manager, Burson-Marsteller, Norway Hotel Nordica, Reykjavik, Thursday 21. September 1

CEO Reputation “Despite the size and complexity of modern corporations, the person in charge still sets the tone, defines the style, becomes the company’s public face. ” Fortune, November 18, 2005 “It takes a lifetime to build a reputation, and only a short time to lose it all. ” Joseph Neubauer, CEO of Aramark, Business. Week, September 23, 2002 2

Corporate Reputation “ If you lose dollars for the firm by bad decisions, I will be understanding. If you lose reputation for the firm, I will be ruthless. ” Warren Buffett 3

How to build trust Stakeholder map- The various needs for communication The media Public opinion Political society CEO & company Internally Financial society 4

Agenda § Global Survey- CEO Capital and Corporate Reputation 2005 § Norwegian Survey- CEO and Corporate Reputation 2006 § An example- Norsk Hydro- Norways second largest oil company 5

Building CEO Reputation - Global § Now in its fifth wave, Burson-Marsteller’s first CEO Reputation Study was conducted in 1997 § The research was conducted online with the Economist Intelligence Unit (EIU), a world leader in global business intelligence and the business–to–business arm of The Economist Group. § The sample includes over 600 business influentials from 65 countries: – – – 146 CEOs 146 senior executives 188 financial analysts – – 103 business journalists 102 government officials 6

The Sample 7

CEO Reputation 8

How much does CEO Reputation Matter? § On a global basis, the CEO is held responsible for 47% of a company’s reputation. Europeans and North Americans attribute less responsibility to the CEO than do Asia/Pacific and Latin American influentials. 2005 CEO Contribution to Corporate Reputation 9

How does CEO Reputation pay off? § Paying attention to what a CEO has to say and recommending the company as a preferred partner is the greatest benefits of having a good CEO reputation. Rank Pay attention to what a CEO has to say 1 SCORECARD Recommend company as good alliance/merger partner 2 North America Buy or recommend stock Give a company more time to succeed 3 Maintain confidence in company when share price lags 4 Latin America Recommend company as alliance partner or good place to work Buy stock in a company 5 Believe a company under pressure from the media 6 Recommend a company as a good place to work 7 Recommend a company’s stock 8 Prefer a company’s products and services 9 CEOs Maintain confidence when share price lags The scorecard identifies regions and segments where scores are higher or lower than the average. 10

What builds CEO reputation? § Credibility, attracting quality management and communicating a clear vision internally are the top three measures that shape CEO reputation. Delivering financial results is necessary for a CEO, but being credible is paramount. Is credible Attracts & keeps quality management team Communicates clear vision *inside* company Demands high ethical conduct Motivates & inspires employees Manages crises and downturns effectively Communicates clear vision *outside* company Executes well on strategic vision Cares about customers Fosters corporate governance Delivers financial results Increases shareholder value Top 12 of 20 CEO qualities Rank 1 2 3 4 5 6 7 8 9 10 11 12 SCORECARD North/Latin America Demand high ethical conduct North America/Asia/Pacific Foster corporate governance Latin America Attract quality management team Financial Analysts Manage crises/downturns effectively 11

What builds CEO reputation- Europe § All business influentials agree that credibility drives CEO reputation. Demanding high ethical conduct ranked relatively low for European influentials, possibly because Europeans already expect strong ethics from their companies’ leaders. Total Is credible 1 Attracts & keeps quality management team 2 Communicates clear vision *inside* company 3 Demands high ethical conduct 4 Motivates & inspires employees 5 Manages crises and downturns effectively 6 Communicates clear vision *outside* company 7 Executes well on strategic vision 8 Cares about customers 9 Fosters corporate governance 10 Delivers financial results 11 Increases shareholder value 12 Top 12 of 20 CEO qualities Eur 1 3 2 9 4 7 5 8 6 10 11 15 NA 1 3 6 2 10 4 8 9 5 7 11 13 = higher than total A/P 1 3 4 5 2 8 7 9 10 6 13 11 LA 1 9 3 2 5 4 10 6 8 12 7 13 = lower than total 12

Top 25 Most Admired CEOs CEO § Worldwide, Bill Gates is the most admired CEO by business influentials by a large margin. § Steve Jobs and Warren Buffett rank a distant second and third. § CEOs from North American, European and Asian/Pacific companies are represented on this most admired list. Company Jeff Bezos John Bond Richard Branson John Browne Warren Buffett John Chambers Michael Dell Lawrence Ellison Bill Gates Carlos Ghosn Jeffrey Immelt Steve Jobs Herb Kelleher A. G. Lafley Terry Leahy Lakshmi Mittal Rupert Murdoch N. R. Narayana Murthy Jorma Ollila Azim Premji Carl-Henric Svanberg Ratan Tata Daniel Vasella Meg Whitman Jack Welch Amazon. com HSBC Holdings Virgin Group BP Berkshire Hathaway Cisco Systems Dell Oracle Microsoft Nissan & Renault General Electric Apple Computer Southwest Airlines Procter & Gamble Tesco Mittal Steel News Corp. Infosys Nokia Wipro Ericsson Tata Group Novartis e. Bay General Electric 13

Top 25 Most Admired CEOs: European Influentials CEO § Among European business influentials, Bill Gates is the most admired CEO worldwide. Company Josef Ackermann John Bond Peter Brabek Richard Branson John Browne Warren Buffett John Chambers Michael Dell Deutsche Bank HSBC Holdings Nestle Virgin Group BP Berkshire Hathaway Cisco Dell Bill Gates Microsoft Carlos Ghosn Fred Goodwin Jeff Immelt Steve Jobs Terry Leahy Lakshmi Mittal Rupert Murdoch Jorma Ollila Helmut Panke Howard Stringer Carl-Henric Svanberg Roger Talermo Donald Trump Daniel Vasella Jack Welch Wendelin Wiedeking Nissan & Renault Royal Bank of Scotland General Electric Apple Tesco Mittal Steel News Corporation Nokia BMW Sony Ericsson Amer Group Trump Novartis General Electric 14 Porsche

Corporate Reputation 15

Drivers of Corporate Reputation High quality products and services Communicates effectively externally Has high quality management Focuses on serving customers Is honest with stakeholders Attract, develop & retain talent Is well-governed Communicates effectively internally Behaves ethically Responds effectively to change Is a good financial performer Is innovative Is a good place to work Is socially responsible Is an industry leader Is environmentally responsible Is truly global Is the largest in its industry Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 SCORECARD Europe Stakeholder honesty and ethical behavior Asia/Pacific Honesty with stakeholders and good governance Communicating externally CEOs Focus on serving customers Financial Analysts Honesty with stakeholders and effective internal communications High quality management 16

Drivers of Corporate Reputation § Europeans rank external communication as the number one driver of company reputation. Honesty with stakeholders was ranked relatively low, possibly reflecting a European expectation for honest behavior. High quality products/services Communicates well externally Has high quality management Focuses on serving customers Is honest with stakeholders Attract, develop, retain talent Is well-governed Communicates well internally Behaves ethically Responds effectively to change Is a good financial performer Is innovative Is a good place to work Is socially responsible Is an industry leader Is environmentally responsible Is truly global Is the largest in its industry Total 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Eur 3 1 4 2 10 5 8 6 12 7 11 9 13 14 16 15 17 18 = higher than total NA 1 3 2 8 5 6 7 10 4 9 11 12 13 15 14 16 17 18 A/P 1 6 4 5 2 9 3 7 8 11 10 12 13 14 15 16 17 18 LA 2 1 4 7 3 9 5 8 6 13 10 11 12 15 16 14 17 18 = lower than total 17

Payoffs of Good Corporate Reputation § Attracting top talent is the biggest payoff of developing a good corporate reputation. Other perceived payoffs include the ability to attract new business and increased customer loyalty. Total Ability to attract and retain talented employees 1 Ability to attract new business/partners/acquisitions 2 Increased loyalty from customers/clients 3 Confidence the company will do the right thing 4 Ability to quickly recover from reputation problems 5 Better able to withstand economic ups and downs 6 Better relations with regulators/government 7 Higher share price than competitors 8 Ability to charge premium prices SCORECARD 9 Latin America Confidence that company will do the right thing Latin America/Asia Pacific Better relations with regulators/government CEOs Confidence that company will do the right thing and a higher share price. 18

Our Approach Client Charter Desired Business Results and Measurement Stock Price/Market Share Rankings & Scorecards Feedback Analysis Culture Quotient Recruitment & Retention Media Coverage/Penetration Corporate Reputation Research CEO Reputation Research Corporate Brand Valuator Fortune’s America’s Most Admired Companies Fortune’s Global Most Admired Companies Reputation Index Brand Asset Valuator (BAV) Reputation Report Card CEO Reputation Report Card Culture Capital Assessment Corporate Equity Analysis Seasons of a CEO Environmental Scan Competitive Platform Analysis/Benchmarking Current Reputation Scorecards Insights Analysis Assessment Creative Execution Strategic Programming Media Relations CEO Dance Card Investor Relations Employee & Constituency Engagement Web Communications Corporate and Internal Advertising Customized Training Programs Corporate Social Responsibility Corporate Identity Strategic Stakeholder Vision and Values Messaging CEO Platform Development Leadership Development CEO’s First 100 Days Rewards & Recognition Integrated Communication Crisis Preparedness Strategy Measurement Planning Brand Definition Foundation Consulting Thought Leadership 19

CEO CAPITAL NORWAY 2005/2006 20

The Norwegian companies included in the study 21

Who are the respondents? 100 90 80 70 60 Investorer Government officials Journalister Media Investors Analytikere/ Meglere Business journalists 50 40 Toppledere Financial analysts 30 20 Executives The only survey in Norway measuring reputation amongst Business Influentials 10 0 Source: Burson-Marsteller og Research International Topplederundersøkelse 2005 22 3

Who are not the respondents? 23

A good reputation is a rapidly increasing success factor in today's society The power of reputation Sum up CEO Reputation is responsible for 47 % of a Company Reputation which influences Profitability Other factors - Share price - Revenue - Turnover - Alliance/ merger partner - Recruiting and retaining - Power · In business · Politically Kilde: Burson- Marsteller analyse; Burson-Marsteller/ Economist Global CEO Capital, 2005 24

What is the most important driver when deciding to invest in a company? ? 25

Quality of leadership and ability to adjust to change is the most important drivers when investing in companies What is most important when deciding to invest in a company? Leadership 40 Adjust to change 48 2005 2003 47 25 38 38 Quality of products and services 38 Credibility Financial situation 31 25 Innovation A trusted and good management is more important than financial situation 29 13 Specific skills or technology 42 28 17 27 26 Ability to recruit and retain 21 Loyal customers 16 Strong brand 22 14 Financial track record 29 23 10 11 Environmental focus 8 Social responsibility 0% 12 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Data: Tall i % av base: 135/88. Figuren viser andelen som har svart 9 -10 på en 10 -delt skala for betydning for valg * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 26

In addition, the CEO reputation affects other key success factors for the company… To what extend does your opinion of a CEO affect your will to. . . 76 Recommended as a alliance/merger partner 70 2005 2003 74 Believe in company despite negative media coverage 34 71 Potential employer 69 70 Buy stocks in the company 72 Believe in company despite share price develops below index 61 62 46 Be informed of company's development 39 34 Buy company's products and services 24 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Tall i % av base: 135/88. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for grad av påvirkning * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 27

Is there a correlation between the CEOs reputation and the company's reputation? ? 28

There is a strong correlation between the CEO and the company reputation Correlation The correlation proves that the trust in the CEO is crucial for a company’s reputation * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 29

Big changes in companies reputation since 2003 shows that the reputation is in motion 100 Reputation is easily broken down in a crisis, but the reputation may be restored within 2 years Company reputation 75 50 25 0 0 25 50 CEO Capital 75 100 Tall i % av base generelt inntrykk: 90. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for tillit (xaksen) og andelen som har svart 7 -10 på en 10 -delt skala for inntrykk (y-aksen) * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 30

Reputation recovery is possible, but demands focus Average in years Norway 2005 2, 2 Global 2005 Comparison of the two studies shows that the time to recover the reputation is shorter in Norway than globally 3, 2 0 0, 5 1 1, 5 2 2, 5 3 3, 5 4 Data: Tall i % av base: Norge 107 som har svart, Globalt: Ca 600 * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 31

What measures must be taken to build reputation? ? 32

To build and sustain a company's reputation, the focus must be on ethics, good leadership and results… Ethics 87 Trust in CEO 79 Financial results 79 Quality products and services 2005 78 Customer focused 76 Attracts and retain good employees 74 Communicates effectively externally The focus on ethics is very high in Norway compared to the global and European results 73 Adjust to change 71 Corporate governance 66 Innovative 64 Social responsibility 55 Industry leading 54 A good place to work 53 Environmental 52 Stakeholder openness 52 Communicates effectively internally 49 Company size 14 Global company 12 0 20 40 60 80 100 Data: Tall i % av base: 135. Figuren viser andelen som har svart 5 -6 på en 6 -delt skala for viktighet * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 33

… the same criteria is also the most important to build and sustain a CEOs reputation How important is it for your trust in the CEO that… 71 Sets high ethical standards 62 66 Creates good financial results 2005 2003 58 63 60 Have a good management team Have the ability to adjust to changes 62 54 58 Manage crisis in a credible way 50 Turn company's strategies into action 57 60 Informs of company's strategies and visions to employees 53 52 Handles the media in a credible way 38 Focuses on customer relations 38 38 44 36 37 Retain and develops employees Informs of company's strategies and visions externally 31 29 30 Focuses on social responsibility When the company reputation and the CEOs reputation depends on the same criteria, it shows how the company and the CEO is identified with each other 22 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100 % Base: Tall i % av base: 135/88. Figuren viser andelen som har svart 9 -10 på en 10 -delt skala for viktighet * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 34

Business newspapers are the most important communication channel for CEOs and companies Fra hvilke kilder lærer du mest om toppledere? • TV, radio and the internet has become more important as a reputation communication channel the last two years due to a rapidly increasing focus in business news Data: Tall i % av base: 135/88. Figuren viser kilder man lærer mest om den enkelte toppleder * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 • In addition, conferences, seminars and other meeting arenas has increased in importance 35

To build trust, a CEO must show the ability to take action within the first 6 -8 months in the position… …to acquire the trust of the employees 7 months (0) 0 …to establish good relations for the company 10 months (0) 3 6 …to attract a management team with the right competence 9 …to improve the financial results 17 months (+1) 12 …to establish the company's visions and strategies going forward 15 18 Months …to turn a negative trend around 15 months (+1) 7 months (-1) Tall i % av base: 135/88 8 months (+1) Tall i parentes: antall måneders endring fra 2003 * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 36

The demands for the CEO ability to take action and show results are increasing Do you believe that the chairboard fires their CEOs too fast? In time 32% 2003 2005 Too late 16% Too early 49% Too early 16% In time 55% Too late Data: Tall i % av base: 135/88 30% • Twice as many business influentials than in 2003 believes that CEOs should be fired earlier • The percentage that believe the CEO should be given more time is down from 49% to 16% * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 37

Zooming in on Norway's 2 nd largest company * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 38

Hydro has the best reputation amongst business influentials Company reputation Hydro 79 78 50 88 2005 2003 78 27 72 73 72 Hydro on top Potential reasons: 69 60 56 24 • Good results 53 28 42 41 46 • Strong management 39 • High ethical standards 33 12 27 • High profile 100 years 78 25 16 13 0% 10% 20% 30% 40% 50% 60% 70% Data: Tall i % av base inntrykk: 135/88. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for inntrykk * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 80% 90% 100% 39

Hydro has a solid and evenly divided trust amongst key stakeholders Company reputation – divided by stakeholders Investors 100 93 90 81 100% 90% 79 Analysts Journalists Executives Government 80% 70% 60% 50% 40% 30% Investors have full confidence in Hydro, but Hydro should strengthen its position amongst governmental officials and analysts 20% 10% 0% Hydro * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 40

The Hydro CEOs reputation is the second highest amongst the measured companies Trust in CEO 92 37 Hydro 79 2005 91 2003 73 55 73 71 49 68 58 Eivind Reiten is amongst the countries most trusted leaders and has increased the trust the last two years 66 27 65 48 65 65 65 52 37 27 37 35 75 33 31 0% 10% 20% 30% 40% 50% 60% 70% Data: Tall i % av base: 135/88. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for inntrykk 80% * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 90% 100% 41

The trust in the Hydro CEO varies more amongst the business influentials than of the company Trust in CEO- Divided by stakeholders 100% Investors Analysts Journalists Executives 94 Government 92 90 90% 86 80% Eivind Reiten has a higher trust amongst analysts than the company itself (79% vs. 94%) Media and governmental officials has the lowest trust amongst stakeholders 70% Hydro * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 42

Trust in CEO and company reputation in 2003 Korrelasjonsområde Svært godt Hydr o Hydro had a high trust in both CEO and in company in 2003 Inntrykk av selskap Svært dårlig Svært lav Tillit til toppleder Svært høy Tall i % av base : 88. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for tillit (x-aksen) og andelen som har svart 7 -10 på en 10 -delt skala for inntrykk (y-aksen) * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 43

Trust in CEO and Hydros reputation has increased further from 2003 to 2005 Korrelasjonsområde Hydro is number one Danger- The only way is down * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 44

That’s all folks! Applause 45

Back up 46

Corporate Reputation “In today’s world, where ideas are increasingly displacing the physical in the production of economic value, competition for reputation becomes a significant driving force, propelling our economy forward. ” Alan Greenspan Federal Reserve Chairman 47

Hydros toppleder har meget høy kjennskap blant norske beslutningstakere Kjennskap til toppleder 2005 Hydro 2003 Vår analyse viser at kjennskap er en forutsetning for topplederens tillit Data: Tall i % av base : 135/88. Figuren viser andelen som har svart kjenner svært godt/lite grann til * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 48

Myndigheter og journalister har best kjennskap til Hydros toppleder Kjennskap til toppleder- fordelt på målgrupper 100% 97 97 92 90 Investor Megler/analytiker Journalist Toppleder Myndighet 90% 84 80% Hydro har lavest kjennskap blant meglere/ analytikere, og forholdsvis lav hos investorer og andre ledere 70% Hydro * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 49

Tilliten til toppleder versus kjennskap til toppleder Tillit til toppleder og kjennskap til toppleder - fordelt på målgrupper Investor Megler/analytiker Journalist Toppleder Myndighet Godt samsvar mellom kjennskap og tillit Norske myndigheter har lavere tillit enn kjennskap til Reiten , mens det er omvendt for meglere og analytikere Tillit Kjennskap Tillit * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 Kjennskap Tillit Kjennskap 50

Hydros omdømme viser en solid oppadgående trend fra 2001 -2005 100 Svært godt 90 Hydro 2005 80 Hydro 2003 70 Hydro 2001 60 Inntrykk av selsk. 50 40 30 20 Svært dårlig 10 0 0 10 Svært lav 20 30 40 50 60 70 Tillit til toppleder 80 90 Svært høy Tall i % av base inntrykk: 135. Figuren viser andelen som har svart 7 -10 på en 10 -delt skala for tillit (x-aksen) og andelen som har svart 7 -10 på en 10 -delt skala for inntrykk (y-aksen) * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 100 51

Hva tar vi med oss videre… § Hydros omdømme helt på topp § ” The only way is down” § Tilliten til Hydros toppleder Eivind Reiten er forholdsvis ujevnt blant beslutningstakerne § § Hydro bør fokusere mer på kommunikasjon mot myndigheter og media Hydro kan fokusere mer på kommunikasjonen mot analytikere * Kilde: Burson-Marsteller og Research International Topplederundersøkelse 2005 52

Management Team Reputation § Six out of ten worldwide business influentials (60%) believe the reputation of the executive management team is more important now than it was two years ago. Importance of Executive Management Team Vs. Two Years Ago 53

Selskapets omdømme blir stadig viktigere, og tillit til toppleder er nå avgjørende for selskapets omdømme. . . Hvor stor betydning har tilliten til en toppleder for din oppfatning av selskapet Vår globale undersøkelse viser at topplederen utgjør 47% av selskapets omdømme * Kilde: Den globale undersøkelsen CEO Capital laget av Burson-Marsteller og The Economist (EIU), gjennomført høsten 2005 54

Who Wants to Be CEO? 55

Who Wants to Be CEO? § § A majority (54%) of global business influentials do not want to be CEO. Europeans (60%) and North Americans (64%) are less likely to want the job and Latin Americans are the most eager. Total Want to Be CEO Do NOT Want to Be CEO Eur. NA A/P LA 46% 40% 36% 49% 73% 54 60 64 51 27 = higher than total = lower than total 56

Why Want to Be CEO? § Global business influentials believe solving complex problems is the most enjoyable part of being CEO. The top five reasons for wanting to be CEO reflect the desire to be involved in running the business at the deepest level. Enjoy complex problem-solving Directly affect the business Implement my ideas Help company go from good to great Build a company to last Make a difference in the world Build future leaders Contribute to employee well-being Earn generous compensation Reach the pinnacle of my career Serve in a prestigious position Rank* 1 2 3 4 5 6 7 8 9 10 11 SCORECARD Latin America Enjoy complex problemsolving Executives/ Financial Analysts Can directly affect the business Media/Government Can directly affect the business Media Get to build leaders Compensation is generous * Does not include CEO responses 57

Why Want to Be CEO? § Business influentials of all regions believe solving complex problems is the most enjoyable part of being CEO. Compensation and prestige are the least important factors to influentials, regardless of region. Enjoy complex problem-solving Directly affect the business Implement my ideas Help company go from good to great Build a company to last Make a difference in the world Build future leaders Contribute to employee well-being Earn generous compensation Reach the pinnacle of my career Serve in a prestigious position * Does not include CEO responses Total* 1 2 Eur. * 1 2 NA* 1 2 A/P* 1 2 LA* 1 2 3 4 5 6 7 8 9 10 11 3 4 6 5 9 7 8 10 11 3 4 6 5 7 8 9 11 10 4 3 5 6 7 9 8 10 11 4 3 6 7 5 8 9 10 11 = higher than total = lower than total 58

Why Not Want to Be CEO? § The biggest concern about being CEO is the lack of work/life balance. Other prevalent concerns are the quarterly earnings focus, general stress and public scrutiny. Too little work/life balance Too much focus on quarterly earnings Too much stress Too much public scrutiny Sarbanes-Oxley and other regulations Too much pressure to reduce costs Difficulty attracting and retaining talent Too many stakeholder demands Excessive media scrutiny Too much travel Too much board oversight Overly competitive business environment Diminished authority Compensation not worth the effort * Does not include CEO responses Rank* 1 2 3 4 5 6 7 8 9 10 11 12 13 14 SCORECARD North America/Europe Sarbanes-Oxley/ Regulations Asia Pacific/Latin America Sarbanes-Oxley/ Regulations Europe Too much pressure to cut costs CEOs Work/life balance and public scrutiny Attract and retain talent 59

Why Not Want to Be CEO? § For all four regions, lack of work/life balance tops the list for reasons to not want to be CEO. Other prevalent concerns are the focus on quarterly earnings, general stress and public scrutiny. Total* Too little work/life balance 1 Too much focus on quarterly earnings 2 Too much stress 3 Too much public scrutiny 4 Sarbanes-Oxley and other regulations 5 Too much pressure to reduce costs 6 Difficulty attracting and retaining talent 7 Too many stakeholder demands 8 Excessive media scrutiny 9 Too much travel 10 Too much board oversight 11 Overly competitive business environment 12 Diminished authority 13 Compensation not worth the effort 14 * Does not include CEO responses Eur. * 1 3 2 4 6 5 9 7 8 10 11 13 14 12 NA* 1 2 3 4 5 6 7 8 9 10 11 14 12 13 = higher than total A/P* 1 2 3 4 7 8 5 6 9 14 10 11 12 13 LA* 1 4 2 3 9 7 8 6 10 5 14 11 12 13 = lower than total 60

CEO Reputation payoff in Europe § Influentials in Europe report that CEO reputation has the greatest influence on their likelihood to listen to what a CEO has to say and recommend the company as the preferred partner. Total 1 Eur 1 NA 1 A/P 1 LA 2 Recommend company as good alliance/merger partner 2 3 2 4 1 Give a company more time to succeed 3 2 5 2 4 Maintain confidence in company when share price lags 4 4 7 3 5 Buy stock in a company 5 5 4 5 6 Believe a company under pressure from the media 6 7 3 7 8 Recommend a company as a good place to work 7 6 8 6 3 Recommend a company’s stock 8 8 6 8 7 Prefer a company’s products and services 9 9 9 Pay attention to what a CEO has to say = higher than total = lower than total 61

Profitability Vs. Social Responsibility § Global business influentials believe that 74% of a company’s responsibility is to make a profit and 26% is to advance societal interest. The debate over profit vs. corporate responsibility continues to be hotly discussed in the media. * Profit Vs. Societal Interest Profit Societal interest * “Social Responsibility: Do The Right Thing, ” Business. Week, 15 August 2005 62