Russell Reynolds Associates Goes Inside the Mind of the Trade Association CEO
Created and funded by companies operating in a specific industry, trade associations work to shape the regulatory environment in ways most favorable to businesses operating in that particular space. They are uniquely positioned at the intersection of government and business, forcing leaders to balance the often competing interests of stakeholders in both spheres.
The arena in which trade associations operate has undergone a metamorphosis in recent years. Amidst economic recession, increased government regulation, a heightened emphasis on transparency and general political malaise, trade associations are grappling with many of the complexities that face the businesses of their members. In this paper, we set out to explore to what extent trade association CEOs have evolved to meet the changing demands of the political and corporate worlds in which they operate.
Historically, trade association CEOs were heavily focused on cultivating political relationships and access. However, changes in the social, economic and political landscape, as well as shifting member demographics and a growing demand for transparency, have prompted a new leadership profile to emerge. While trade association leaders must still possess public policy savvy and an ability to develop and maintain critical relationships in Washington, D.C., and beyond, they must also demonstrate traditional corporate executive competencies, such as sound business acumen, proven operational expertise and, in some instances, direct or aligned industry experience. Today, trade association CEOs serve as trusted representatives of their constituents—they understand the unique challenges facing their members and work to develop policy and advocacy campaigns that combat these challenges while also ensuring programmatic content that meets member needs.
To assess the profile of this new type of leader, Russell Reynolds Associates asked leading trade association CEOs to complete well-validated psychometric assessment tools that focus on behavioral characteristics relevant to leadership roles. The results were aggregated and compared with a group of best-in-class corporate CEOs from Russell Reynolds Associates’ proprietary database to determine on which of the 60 psychometric scales the trade association CEOs were statistically similar to and different from their corporate peers.
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