Great culture, great CEO: employees favor CEOs when they are satisfied with their company's culture.

Author:McCollum, T.


Corporate culture is the strongest factor in employee ratings of their organizations' CEOs, according to What Makes a Great CEO?, a report by Mill Valley, Calif.-based employment and recruiting website Glassdoor. In fact, a one-level increase in overall company ratings on a five-star scale--from three stars to four stars, for example--raises CEO approval ratings in large, publicly listed companies by nearly 37 percent, the report notes. "In the eyes of many employees, CEOs are ultimately held accountable for workplace culture," the report observes.

The Glassdoor findings are based on 1.2 million CEO approval ratings for about 70,000 U.S. employers that were collected in its company review survey. Researchers then looked at factors that might influence CEO approval ratings, using data from external sources on CEO pay, tenure, and company profitability.

Opinion of senior leadership, view of career opportunities, and quality of compensation and benefits are the cultural factors that have the greatest impact on CEO approval ratings. Among cultural factors, work-life balance is the exception, surprisingly-CEO approval is lower in organizations with high work-life balance.

Aside from company culture, CEOs of more profitable companies receive the highest approval ratings. Moreover, CEOs who are company founders have higher approval ratings than executives who were promoted internally or hired externally. The highest-rated CEOs are in the real estate, construction, IT, and finance industries, while the lowest rated are in the retail, manufacturing, transportation, and...

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