INSIGHTS

From band leader to master conductor

OUR LATEST GROUND-BREAKING REPORT:  LAUNCHING 28 JUNE

From band leader to master conductor

How corporate affairs executives are orchestrating an ever-larger symphony of corporate functions

 

A time of change and opportunity

The last 25 years have seen an extraordinary transformation in corporate affairs. The discipline that once struggled so desperately for a voice and an identity now enjoys influence, stature and reach that would have been unimaginable to its practitioners even a single generation ago.

That maturation has been a complex story of subtle, growing pressures and sudden developmental leaps. From the early internet of the 1990s, through the social media revolutions of the late 2000s, successive digital transformations played an obviously significant role. As the whole world suddenly acquired a voice, the corporate reputation was stripped of its security walls and the very notion of ‘communication’ changed forever. The professional context would never be the same again.

But impressive and rapid professionalisation inside the industry is what fortified it to take on these challenges, and which is paying extra dividends today. Long gone now are the old-school days of brandy-and-cigars PR; of tactical internal communications teams focused on twee, community-building magazines; or of sustainability teams toiling simply to add nice compliance window-dressing to the company’s activities. By the time we arrived at the mid-2010s, a world of voluble consumer activism and populist instability, we were looking at an utterly transformed profession, recalibrated wholesale towards outcomes rather than output. It had never been more in demand. It had credibility and purpose. And it was recognised across the business world as a disciplined function that had a meaningful impact on culture and company identity.

 The profession’s coming of age
It seemed like the end of the story. But not so. For, in the last couple of years, another giant leap forward has become very apparent, something of an entirely different order to the developments of the past. This is not just another new wave of professionalisation but a complete blank-slate rethink; the inevitable culmination of those years of developments, growth spurts and external pressures, now leading to a complete redesign of the corporate affairs function and a rethink of the very discipline of communications. It feels like we are entering the profession’s final realisation, its true coming of age.

Its emblem is not so much enhanced stature but enhanced expectation. The debate that caused so much anguish for leading practitioners for so many years – how to prove the impact of great communications on company performance – is no longer even a serious topic. That argument has been won. CEOs and shareholders the world over don’t just understand it instinctively these days, they are already two steps ahead, demanding to know what you’re doing about it.

It is evident, too, in the way corporations now view communications – not merely as a function but as a core business process. Brand positioning, reputation and stakeholder management today beat like a pulse through the boardroom agenda. Communications competencies have become genuine pre-requisites for executive leadership across all fields. And, for many multinationals today, sustainability is the driving force of the company’s entire global strategy and the number-one concern of its major investors. Add in the effects of a very people-centred crisis, the COVID-19 pandemic – pushing corporate affairs directors directly into the spotlight, front and centre – and the discipline has gone from being a highly professional unit, finally getting due respect for its expertise, to becoming something else entirely: a core function of the executive.

 The challenge for the profession
But in such a moment of actualisation, enormous structural and capability questions arise. The central part of the corporate affairs remit is now clear: It’s the reputation. And executive teams now implicitly recognise reputation as something that needs professional executive management, not only due to its central importance to every commercial goal, but its eye-watering complexity – affected by everything, and with everything affecting everything else; a billion actions, small and large, continuously fissioning and creating reputational reactions everywhere.

The challenge? Across multinationals, the corporate affairs director has become the one charged with keeping this nuclear reaction of causes and effects under control – harnessing its positive energy and preventing its potential disasters.

The opportunity: They are being given often unprecedented resources and reach to achieve that goal – including, crucially, the ability to take on wider remits where required, even absorb satellite functions and departments into their spheres of control.

But how? For a corporate affairs leader to formally ‘own’ every function and process affecting the company’s reputation would create a vast, all-encompassing and unwieldly department, virtually indistinguishable from the whole org chart. Even simply building in strategic alliances and dotted reporting lines, steering groups or oversight processes would represent a gargantuan workload for one individual, for there is nothing – from operations to finance to marketing to sales – that does not affect how the company shows up in the world. Yet not changing reporting lines and team ownership would leave ‘management’ of the corporate reputation an illusion.

 Our research
As well as drawing on our own day to day discussions with large corporates looking to hire such talent, we interviewed a range of senior corporate affairs leaders across a variety of industries, all of whom had taken a slightly different view of the challenge. Each had expanded their own accountabilities in their own unique way, from taking on the company strategy portfolio, to building in oversight of HR, to taking on chief-of-staff responsibilities, to moving into customer research, to taking on brand and marketing – and sometimes all of the above. Our latest report outlines what these senior professionals have done in some of the world’s biggest multinationals, what their rationale was, and what they learned along the way.

In many cases, the new, expanded remits they created were a logical extension of their own personal career journeys – former investor relations leaders, for example, who, when stepping up to corporate affairs leadership, had naturally absorbed strategy and financial road-mapping responsibilities into their portfolio.

In other cases, it was a reflection of the sector or company culture: B2B organisations for whom brand and marketing had become so indistinguishable from communications that combining the two into a single function was a natural and obvious step. Or companies undergoing internal resets of the employee experience and employer brand, whose corporate affairs leaders had formed mergers with their HR departments.

Each interviewee shared the benefits of the moves they had made (almost universally: alignment; strategic coherence; cost and process efficiency; better line of sight) as well as the challenges (conflicting responsibilities and, most commonly, bandwidth and time management). And structure, of course, is only one part of it. The growth of the function brings significant people-management challenges for any good leader too.

These will be just some of the key discussions for our profession as we move forward from here, and we hope the report helps the reader prepare for the necessary changes in their own situation.

 Taking two steps forward
But some in the profession have gone even further, reasoning that this moment demands a complete reimagining of the function as a whole – to symbolise and signal the significance of the change, and to have it recognised properly both internally and externally. They are throwing out the old ‘corporate affairs’ brand and creating an entirely new department with an entirely new title.

Others still have taken a quite different strategic move in this new environment: a move out of the function entirely. Seeking both to capitalise on the enhanced stature of corporate affairs – offering, for the first real time, a window of opportunity to make lateral executive moves – and also to acknowledge that the future of corporate affairs leadership lies in broad-ranging business acumen, they have taken the leap into wider leadership to become heads of strategy or customer relations, MDs, even CEOs.

 Which way will the cards fall?
All of our interviewees present compelling arguments for taking on additional responsibilities, building specific partnerships, or taking more dramatic steps to refashion the function or their own executive skillset. There is no right answer here – each company and corporate affairs director will be different. The next few years will undoubtedly see the emergence of a range of different answers to the present challenges of matching corporate affairs’ structure to the enhanced expectations of the role.

The key is not the model, of course, it’s the delivery. And here, a warning sign must hang over everything. The new, exalted status of the profession has been so long desired, the importance of communications to business performance so long argued, that it can lead to a sort of giddy assumption – at this clear inflexion point in the profession’s history – that the profession has triumphed; that it will now have its deserved recognition and scope, and only sunlit uplands lay ahead.

It may not necessarily be so. The added responsibilities and scope, of course, reflect added expectation and new demands. The function is now at the sharpest end of leadership. And while, most recently, the central role taken by corporate affairs in the corporate response to the pandemic burnished the reputations of many high flyers in the profession, it equally exposed those who, in that most glaring of spotlights, were found wanting.

And though the additional responsibilities being afforded corporate affairs today may seem like an increase in power, they could also spell power being taken away: The new generation of corporate affairs leader has to be a swiss-army-knife executive, as insightful about customers as they are about employees and governments; as adept at balance sheets as broadcasting; as clear about the equity markets as equality and diversity; as talented at competitor analysis as campaigning. That is a tall order for some in the profession. Multinationals have come to the conclusion that corporate affairs is absolutely central to the organisation’s functioning – but there is always a chance that they will therefore parachute in executives from other functions to run it. Indeed, there is some evidence that this has happened in places.

We urge you to take this research not just as interesting food for thought, but as the inspiration to seize the moment and plant your own flag in the ground. It really is an unprecedented time in the field – and that means unprecedented opportunities to grow personally and advance professionally.

Don’t miss it – launching 28 June.

To request your copy of the report, contact us:  contact@broomeyasar.com