‘Best Companies for Leaders’ outperform the industry
Each year since 2005, US magazine Chief Executive has sought to identify those companies that excel in leadership development. In partnership with consulting firm Chally Group, they approach globally acting US companies through a questionnaire and interviews to learn what they are doing to identify and nurture people three or more levels down the chain from the CEO.
The annual survey is interpreted on the always same five core criteria (see below), which have now led to the 2015 ranking of public listed companies (here are the top 10):
- General Electric
- IBM
- Procter & Gamble
- EMC Insurance
- Verizon Communications
- VF Corporation
- Southwest Airlines
- Wipro Ltd.
- The Cooper Companies
- Dow Chemical
As their business model is completely different, they also created a list of private companies (here are the top 5) :
- Deloitte
- Hilti
- Dell
- Transplace
- MWH Global
The journal made a business analysis of those companies, which had top ranks over the last decade, and here is the astonishing result: the best companies for leaders outperformed other participants by far, their market capitalization grew by 122% over the last decade, while the bottom of the list only grew by 37%. In comparison, the MSCI US Broad Market Index grew by 119% over the same decade.
Chief Executive scores on these five key criteria:
- Having a formal leadership process in place
- The commitment level of the CEO to the leadership development program as measured by the percent of time spent
- The depth of the leadership funnel as measured by the percentage of senior management positions filled by internal candidates
- The number of other companies that report recruiting from the company being evaluated
- A shareholder value performance metric based on 10-year growth or decline in market capitalization
