Investor Relations

Press Release

Corporate Leadership Moves in the Right Direction, Sets All-Time High in Q1 2011 Korn/Ferry Confidence in Leadership Index

June 6, 2011

LOS ANGELES, June 6, 2011 /PRNewswire via COMTEX/ --

The Korn/Ferry Institute's Confidence in Leadership Index reveals significant momentum in the direction of corporate leadership globally in Q1 2011, reaching an all-time high since the survey was first conducted in 2009. Led by a large gain in Europe, executives in all but one region responded that corporate leadership was not only headed in the right direction, but trending more favorably now than any time since the survey's inception.

(Photo: http://photos.prnewswire.com/prnh/20110606/LA11846)

The Korn/Ferry Institute Confidence in Leadership Index, now in its third year, measures four key factors of leadership:

  • Credibility of Leadership
  • Trust in Leadership
  • Direction of Leadership
  • Characteristics of Leadership

The data was collected by Korn/Ferry during Q1 2011 via an online survey of more than 500 global executives.

The relationship between leadership confidence and economic measures continues to hold in North America. North American exchanges ticked upward in the quarter and North America gained ground in all Index measures.

Europe and Central/South American results were not as correlated with economic data. Europe's Confidence Index results were mixed, however Direction of Leadership shot upwards, following improvement in most European markets. Central and South American markets were down a small percentage, though Direction of Leadership continued to climb and lead the global study.

Results from Asia Pacific were much more volatile than financial markets. The study was conducted prior to the Japanese earthquake and tsunami, but re-fielded following the March 11 disaster to determine its impact on confidence in leadership. The comparative data revealed virtually no change in pre- and post-disaster attitudes. The Asia results reported in this study show all-time lows in Credibility, Trust, and Direction of leadership though regional financial markets were either flat or up slightly.

"We continue to track confidence in leadership against economic factors, but this wave of data suggests other environmental influences may override the impact of economic data," said Ana Dutra, CEO, Korn/Ferry Leadership and Talent Consulting. "The results from Asia Pacific clearly warrant further study. With many different types of economies, the most important question is how and why factors such as financial, geo-political, and ethical volatility are destabilizing confidence in corporate leadership with varying intensity in different parts of the world."

Confidence in Leadership Major Findings

  • Globally, Credibility of Leadership declined one point, tallying 75 on a 100-point scale.
    • Credibility of Leadership data from Asia Pacific shows declining sentiment towards leadership at all levels. Overall Credibility of Leadership sunk from 76 in 2010, to 71 in Q1 2011. All major categories follow a similar trend in Asia Pacific. For example, credibility of CEOs fell from 77 to 72 and credibility of Boards of Directors fell from 73 to 66.
    • Central/South America also showed weakness in Credibility of Leadership, declining in categories such as CEO Leadership and Company Management Leadership by five points each.
    • North America gained ground in most categories; notably CEO Leadership climbed three points to 77.
    • Credibility of Leadership fell by one point overall in Europe; the largest mover in the study was a three-point dip in CEO credibility.
  • Trust in Leadership fell a point from 78 to 77 on the 100-point scale globally.
    • Asia Pacific's Trust in Leadership score fell five points to an all-time low of 74.
    • Europe's Trust score similarly fell four points to an all-time low of 70.
    • Central/South America also lost four points, falling from 83 to 79.
    • North America countered the trend, increasing by two points from 79 to 81.
  • Direction of Leadership gained momentum in the first quarter of 2011 after relatively little movement from 2009 to 2010, gaining seven points from +20 to +27 on a scale ranging from -100 (getting worse) to +100 (getting better).
    • North America, traditionally the least optimistic about direction of leadership, tallied a nine-point gain from +9 to +18, though it still trails all over geographies.
    • Europe shot up a surprising 13 points from 2010 from +16 to +29.
    • Central/South America, historically the most positive about direction of leadership, remained the most optimistic and gained even more ground moving from +50 to +57.
    • Only Asia Pacific slipped in the Direction of Leadership category, falling from +34 in 2010 to +24 in Q1 2011, a 10-point decline.
  • The ranking of Leadership Characteristics remained unchanged year over year
    • Strategic Skill still ranks atop a list of seven critical competencies.
    • Personal and Interpersonal Skill continue to gain ground, increasing by one point annually to solidify the number two position in the rankings.

Snapshot of Confidence in Leadership Survey Results

Credibility of Leadership Scores:

  • Overall credibility of leadership globally is down one point from 2010.

Category

Q1 2011

2010

Change

Own Leadership Ability

87

88

-1

Direct Reports' Leadership Ability

74

75

-1

Boss' Leadership Ability

71

73

-2

Company Management's Leadership Ability

71

73

-2

CEO's Leadership Ability

76

76

0

Board of Director's Leadership Ability

71

71

0

Global Average for Credibility of Leadership

75

76

-1


Region

Q1 2011

2010

Change

North America

76

77

+1

Asia Pacific

76

71

-5

Central/South America

80

77

-3

Europe

73

72

-1


Trust in Leadership Scores:

  • Trust in Leadership fell two points to 78 on the index, with every single category losing ground. Only North America saw improvement in the Trust in Leadership score, increasing by two points.

Category

Q1 2011

2010

Change

Our business consistently adheres to the highest standards of business conduct

82

81

-1

The company operates with the highest set of ethical standards

82

81

-1

All employees understand and follow our code of conduct

79

78

-1

Our leaders are models of ethical business conduct

80

78

-2

Leaders are quick to admit mistakes and accept responsibility

69

67

-2


Category

Q1 2011

2010

Change

North America

81

79

+2

Asia Pacific

74

79

-5

Central/South America

79

83

-4

Europe

70

74

-4

Global Average for Trust in Leadership

78

80

-2


Direction of Leadership Scores:

  • The direction of leadership - measured on a -100 (getting worse) to +100 (getting better) scale - gained seven points (from 20 to 27), an all-time high. Only Asia Pacific lost ground in the Direction of Leadership score, dropping 10 points from 34 to 24.

Region

Q1 2011

2010

Change

North America

18

9

+9

Asia Pacific

24

34

-10

Central/South America

57

50

+7

Europe

29

16

+13

Global Average for Direction of Leadership

27

20

+7


Characteristics of Leadership Scores:

  • Strategic skills are the most important leadership factor according to global executives, followed by Personal and Interpersonal Skills. The seven factors in the ranking are based on Korn/Ferry's proprietary leadership assessment tools.
  • Following are the most significant leadership factors ranked by global executives by allocating 100 points across all factors:

Global

Rank

Skill

Global

Index

Score

Europe

Index Score

North

America

Central/

South

America

Asia

Pacific

1

Strategic Skills

18

19

18

18

17

2

Personal and Interpersonal Skills

17

17

17

18

15

3

Energy and Drive

14

14

13

14

15

4

Managing Financial Performance

14

14

14

15

15

5

Courage

13

12

13

12

13

6

Operating Skills

13

13

14

12

14

7

Organizational Positioning Skills

12

12

12

12

11


The margin of error within each wave is +/- 4.4%. For complete survey results, please visit www.kornferryinstitute.com.

About The Korn/Ferry Institute
The Korn/Ferry Institute was founded to serve as a premier global voice on a range of talent management and leadership issues. The Institute commissions, originates and publishes groundbreaking research utilizing Korn/Ferry's unparalleled expertise in executive recruitment and talent development combined with its preeminent behavioral research library. The Institute is dedicated to improving the state of global human capital for businesses of all sizes around the world.

About Korn/Ferry International

Korn/Ferry International, with a presence throughout the Americas, Asia Pacific, Europe, the Middle East and Africa, is a premier global provider of talent management solutions. Based in Los Angeles, the firm delivers an array of solutions that help clients to attract, deploy, develop and reward their talent. Visit www.kornferry.com for more information on the Korn/Ferry International family of companies, and www.kornferryinstitute.com for thought leadership, intellectual property and research.

SOURCE Korn/Ferry International

Take a Closer Look