View the full Brand Guardianship Index 2024 here
The world’s prominent business figures have met this week at the World Economic Forum to discuss the importance of rebuilding trust. In recognition of this, Brand Finance, the world’s leading international brand valuation consultancy, has launched the 2024 Brand Guardianship Index. This ranks the world’s most successful CEOs on their role as guardians of their respective brands in shaping brand success and values.
Huateng Ma, CEO of Tencent, recognised as world’s leading CEO in 2024 Brand Guardianship Index released at Davos, for his guardianship of WeChat brand
Huateng Ma, CEO of Tencent and the driving force behind WeChat, has taken top spot on the Brand Guardianship Index 2024. His leadership, marked by a steadfast commitment to innovation, user engagement, and trust, has not only propelled Tencent to remarkable heights in the technology sector but has also set a gold standard for CEOs worldwide.
This year, under Ma’s leadership, WeChat has become the world’s strongest brand, in a separate announcement from Davos at the World Economic Forum. Ma has led WeChat to build exceptional brand strength, underpinned by its essential, familiar, and trusted status in China, its dominant market.
Leena Nair of Chanel is world’s top female brand guardian, Jensen Huang of NVIDIA is number one for brand value growth during tenure
Chanel’s CEO Leena Nair was recognised as the world’s top female CEO, with respondents rating her as the best performing strategist. Nair’s leadership has been rated as having the strongest reputation amongst the top 100 CEOs. Nair is unusual in that she was hired to Chanel from outside the company, and her experience at Unilever appears to be serving her well.
Last year’s Brand Guardianship Index leader, NVIDIA CEO Jensen Huang, has fallen to third in the rankings, but remains the leader for brand value growth during his tenure. As the co-founder of the brand in the early 1990s, Huang has played a key role in turning NVIDIA from a challenger up-start gaming processor manufacturer to a modern AI leader that is playing a key role in changing the global economic landscape.
A growing role for ESG
Brand Finance constructs a balanced scorecard of measures designed to identify the factors that best capture the ability of CEOs to act as a steward of their company’s brand and steward long term value. This year’s analysis reveals that ESG has become the single most important driving force in determining CEO reputation. Being regarded as ‘a sustainability champion’ accounts for 14% of variation in reputation scores, ahead of factors such as perceived trustworthiness (12.5%), having ‘a strong strategy and vision’ and global recognition.
Tech's new vanguard: financial gurus lead the leap beyond engineers' era
In a striking shift in the technological landscape, the average compensation for CEOs in the top 100 firms has surged by 9% from last year, with the top salary witnessing a staggering 26% increase, placing Sundar Pichai at the apex as the highest earner. This upward trajectory in remuneration reflects the increasing importance of seasoned leadership within the tech industry.
In tandem, there's a notable transition in the background of these corporate titans; a majority now emerge from the financial sector, signalling a paradigm shift that underscores financial expertise as indispensable for steering a company. The diminishing presence of engineers and computer scientists at the helm is indicative of the generational handover as the original founders of the tech behemoths recede into retirement, making way for the next wave of leaders.
Concurrently, the industry buzz has pivoted from last year's metaverse mania to a fervent focus on artificial intelligence and strategic partnerships, reflecting the dynamic, ever-evolving priorities of the tech sector.
Study shows leaders need to harness and hone their brands to create value
The 2024 Brand Guardianship Index has found a strong correlation between excellent brand leadership and strong brand value growth for their businesses. On average, the brand values of brands led by the top 100 CEOs grew 10% this year. The brand values of brands led by the top ten CEOs grew by an average of 40% this year.
World’s top brand leaders ranked in study published at Davos
The comprehensive study ranks top CEOs and companies across various sectors, highlighting their achievements in technology adoption, sustainability efforts, commercial leadership, and strategic long-term vision. The report underscores the significant impact these leaders have on their respective brand's value and market position.
"Akira Shimada of NTT Group and Piyush Gupta of DBS have been recognised for their exceptional tech readiness, driving their companies to the forefront of technological innovation. Similarly, sustainability champions like Bob Sternfels of McKinsey are setting new benchmarks in corporate environmental responsibility."
David Haigh, Chairman and CEO of Brand Finance
The study also emphasises the critical role of strong commercial leadership and strategic vision in enhancing brand value. Leaders like Denise Coates of Bet365 and Chris Leahy of CDW have demonstrated exemplary commercial acumen, significantly contributing to their brands' robust market positions and high valuations.
"Our analysis clearly shows that the calibre of a brand's guardians – the CEOs and leadership teams – is a key determinant of its value. In today's rapidly evolving market landscape, the strategic decisions and leadership qualities of these individuals are more important than ever."
David Haigh, Chairman and CEO of Brand Finance
The Brand Guardianship Index is a testament to Brand Finance's commitment to providing in-depth, actionable insights into brand valuation and management. The full ranking is available on the Brand Finance website, and David Haigh, CEO of Brand Finance, is available for global media interviews.
Brand Finance is the world’s leading brand valuation consultancy. Bridging the gap between marketing and finance for more than 25 years, Brand Finance evaluates the strength of brands and quantifies their financial value to help organizations of all kinds make strategic decisions.
Headquartered in London, Brand Finance has offices in over 20 countries, offering services on all continents. Every year, Brand Finance conducts more than 5,000 brand valuations, supported by original market research, and publishes over 100 reports which rank brands across all sectors and countries.
Brand Finance also operates the Global Brand Equity Monitor, conducting original market research annually on over 5,000 brands, surveying more than 150,000 respondents across 38 countries and 31 industry sectors. Combining perceptual data from the Global Brand Equity Monitor with data from its valuation database enables Brand Finance to arm brand leaders with the data and analytics they need to enhance brand and business value.
Brand Finance is a regulated accountancy firm, leading the standardization of the brand valuation industry. Brand Finance was the first to be certified by independent auditors as compliant with both ISO 10668 and ISO 20671 and has received the official endorsement of the Marketing Accountability Standards Board (MASB) in the United States.
Brand is defined as a marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos, and designs, intended to identify goods, services, or entities, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits.
Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors. Brand Finance evaluates brand strength in a process compliant with ISO 20671, looking at Marketing Investment, Stakeholder Equity, and the impact of those on Business Performance. The data used is derived from Brand Finance’s proprietary market research programme and from publicly available sources.
Each brand is assigned a Brand Strength Index (BSI) score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding Brand Rating up to AAA+ in a format similar to a credit rating.
Brand Finance calculates the values of brands in its rankings using the Royalty Relief approach – a brand valuation method compliant with the industry standards set in ISO 10668. It involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a ‘brand value’ understood as a net economic benefit that a brand owner would achieve by licensing the brand in the open market.
The steps in this process are as follows:
1 Calculate brand strength using a balanced scorecard of metrics assessing Marketing Investment, Stakeholder Equity, and Business Performance. Brand strength is expressed as a Brand Strength Index (BSI) score on a scale of 0 to 100.
2 Determine royalty range for each industry, reflecting the importance of brand to purchasing decisions. In luxury, the maximum percentage is high, while in extractive industry, where goods are often commoditised, it is lower. This is done by reviewing comparable licensing agreements sourced from Brand Finance’s extensive database.
3 Calculate royalty rate. The BSI score is applied to the royalty range to arrive at a royalty rate. For example, if the royalty range in a sector is 0-5% and a brand has a BSI score of 80 out of 100, then an appropriate royalty rate for the use of this brand in the given sector will be 4%.
4 Determine brand-specific revenues by estimating a proportion of parent company revenues attributable to a brand.
5 Determine forecast revenues using a function of historic revenues, equity analyst forecasts, and economic growth rates.
6 Apply the royalty rate to the forecast revenues to derive brand revenues.
7 Discount post-tax brand revenues to a net present value which equals the brand value.
Brand Finance has produced this study with an independent and unbiased analysis. The values derived and opinions presented in this study are based on publicly available information and certain assumptions that Brand Finance used where such data was deficient or unclear. Brand Finance accepts no responsibility and will not be liable in the event that the publicly available information relied upon is subsequently found to be inaccurate. The opinions and financial analysis expressed in the study are not to be construed as providing investment or business advice. Brand Finance does not intend the study to be relied upon for any reason and excludes all liability to any body, government, or organisation.
The data presented in this study form part of Brand Finance's proprietary database, are provided for the benefit of the media, and are not to be used in part or in full for any commercial or technical purpose without written permission from Brand Finance.
