Tuesday, 22 May 2012
It has been revealed in a report issued by Deloitte that ensuring that a company has quality leadership can actually raise the value of that company by up to 16 per cent.
While everyone knows the importance of having good organisational leadership in place, it is perhaps surprising that it can increase the value of a company to such an extent. The report, in which 45 per cent of respondents highlighted the importance they place on the senior leadership team at a company when determining its success, will come as an invaluable resource to recruitment agencies.
Speaking about the report, Deloitte Consulting Principal, Adam Canwell, said, “With this research we wanted to put a quantitative metric on the effectiveness of leadership, in order to help businesses understand the impact that leadership can have on their performance and market value. This report uncovers a tangible metric that has a real impact on the long-term shareholder value of organisations, which we hope will set out a compelling vision of effective leadership for the future.”
Companies had their leadership valued and on average were awarded a premium of 15.7 per cent for leadership that was shown to be particularly effective. For those companies that were judged to lack this type of leadership, they received a 19.8 per cent discount on average. This meant that the difference between a company with effective leadership and one without could total more than 35 per cent.