Over the years, we’ve had a lot of conversations about executive protection with prospective corporate clients. In these preliminary discussions, the folks we talk to – typically CSOs, chief counsels, or CFOs – have been tasked with investigating options for executive protection. Usually for their CEOs, but, increasingly, also for additional members of the C-suite and other key employees whose wellbeing is critical to business success.
The reasons for their newfound interest in EP vary. Some have been mandated by their boards to look into executive protection. In other cases, the nature of threats to the principal has changed suddenly. In still others, benchmarking with comparable corporations has indicated that security for their top people is lacking.
Despite their different points of departure, however, these new customers have in common that CEOs and others are hesitant or even downright reluctant to have anything to do with executive protection.
In this blog, we take a closer look at three of the most frequently mentioned hesitations that make new corporate clients express – and the myths about executive protection that underlie them.
Myth 1: Executive protection is no different from “bodyguards”
Just search “bodyguard” in Google to know why this one pops up. The first of many pages of search results point to the BBC series and the Whitney Houston movie, both of which are entertaining but far from accurate descriptions of corporate executive protection. Sharpen your search to “News” and learn about paparazzi thrashings, tell-all memoirs, and other scandals.
When most people think about personal or close protection, they think about bodyguards. And when most people think about bodyguards, they think about very visible men in black with guns, squiggly earpieces, big muscles, and stone-cold faces. Alternatively, the United States Secret Service comes to mind, with its 3,200 employees and multi-billion-dollar budget – fitting for presidents, but not for corporate leaders!
We get it. After a few decades in EP, we’ve combatted far more preconceived notions about “bodyguards” than we have attackers on our principals. Of all the myths surrounding executive protection, the bodyguard image is probably the one that’s hardest to bust.
As anyone who’s ever been pigeonholed by stereotypes knows, other people’s prejudices are hard, if not impossible, to change. This is why we’ve spent a good deal of time, ink, and effort talking about executive protection rather than bodyguarding. Although the term doesn’t eliminate notions about bodyguards, it can sometimes help move the conversation to more neutral ground.
Corporate executive protection is about more than keeping our principals safe. It’s also about helping them to be more productive. So, maybe we should refer to our industry as “Executive protection and productivity enhancement”? Kind of long, but accurate.
Enhanced productivity is the least understood benefit of quality executive protection. When done right, it reduces a good deal of the friction that comes with the territory of a busy life. Freeing up time, increasing mental bandwidth, and improving peace of mind would raise anyone’s productivity. As we’ll see below, doing it for the persons tasked with running major corporations is a productivity multiplier with quantifiable benefits.
Myth 2: Principals are the best judges of whether and when they need EP
Another objection that we often hear has to do with perceived threats and vulnerabilities – and the principal’s ability to deal with these on his or her own.
The principals we work with are typically highly resourceful people. They are not averse to risk and have overcome all kinds of obstacles on their way to the C-suite. They hitchhiked from Paris to Pakistan as 18-year-olds. They’re competitive iron men and women with black belts in unpronounceable martial arts. They maxed out 20 credit cards, negotiated the devil out of his pitchfork, and ate nothing but ramen for two years to turn an idea into multi-billion-dollar commercial success. Why would they ever need executive protection?
Because things change when you are the prominent leader of a large, publicly listed company.
To put it bluntly, dear principals: It’s not just about you. It’s about the role you play and the impact, should something happen to you, to the company’s reputation, business continuity, and share price. That’s why boards mandate executive protection programs. It’s not because they think you are a pushover who can’t take care of themselves. It’s because risk oversight is one of their prime responsibilities, and your wellbeing is another item on the list of everything in the enterprise that might go wrong. Along with cybersecurity breaches, unpaid accounts receivable, new patent legislation, and all the rest.
Like it or not, prominence affects risk. When they were younger and less well known, today’s top executives weren’t on too many radars. The risk mitigation strategies that worked then most likely do not work as well when their net worth is public knowledge, as is their address, the schedule for their public appearances, and many personal details about them and their families.
Any good corporate executive protection program should begin with an expert analysis of the threats and vulnerabilities that add up to risk. In our experience, principals are rarely the most reliable analysts of their personal risks.
Myth 3: Executive protection is too expensive and not worth the cost
Bursting this myth’s balloon is not that difficult. Many corporations have spent money on executive protection for years and continue to do so. New programs start every year. The market is growing. So, it’s obvious that at least some corporations consider their expenditures on executive protection as good value for money.
With that said, it’s still clear that new clients, in particular, have difficulty in determining whether an executive protection program is “too expensive” or worth the cost. We think there are at least three reasons why cost makes new clients hesitate before starting an executive protection program.
1. Nothing has happened to the principal until now. Why should they pay good money to maintain an uneventful status quo?
Because things change. For one thing, as we point out above, risk changes when a person becomes CEO. For another, the nature of the threats and vulnerabilities contributing to risk is also under constant flux.
2. Some corporations fail to consider the productivity enhancements of executive protection.
According to Fortune, the $13.7 trillion in revenues generated by Fortune 500 companies represent two-thirds of the U.S. GDP and $22.6 trillion in market value. The average annual compensation for CEOs of the U.S.’s biggest companies tops $20 million. With these numbers, the potential payback of even marginal productivity improvements for CEOs is substantial.
While boosting a corporation’s top executives’ productivity through an effective executive protection program is nothing we can calculate with any certainty, we do have some strong anecdotal evidence to back up the notion:
- Turning commuting time into working time: If a principal has a 30-minute commute to work employing a security driver can add one hour of work time per day, or five hours a week. Assuming the principal does this about 20 weeks a year, that’s an additional 100 hours per year that could be spent on the business rather than dealing with the drive.
- Spending more travel time on work and less on logistics: As a client told us many years ago, “You guys make it easier to travel, so we travel more.” We know from experience that secure travel logistics can easily increase the number of meetings executives can pack into a day on the road by 20-30%. We also know that secure travel logistics can transform time moving between airports, hotels and meeting venues – often an hour or more a day – into more profitable pursuits.
- Reducing everyday frictions frees up attention for other things: Cars appear. Doors open. Paths are unencumbered. When daily needs are anticipated and met, it becomes easier to attend to the big picture rather than all the practical details.
3. Corporations often have unrealistic ideas about how to put together a sustainably effective program.
Even when the need for an executive protection program is recognized, some new clients have a hard time with the math and HR realities.
The typical CEO works about 70 hours a week. For the EP team working around the CEO’s schedule, the workweek is even longer. Agents need to arrive early for everything and leave only after the principal has retired for the day. They must do advances. They have regular reporting that has to be done when they are not with the principal. Agents need regular training to maintain perishable skills. They also need to commute and travel as part of the job. And they, too, have families, vacations, sick days, and lives away from work.
You see where we’re going with this without us going too far into the weeds: It takes more than one agent to run a full-time EP program for one person. If the principal wants one favorite agent to do everything, then that agent will burn out pretty fast. If the principal wants the best people, and who doesn’t, they cost more than average people. Go figure.
But rest assured, executive protection providers compete on cost as well as quality. Five RFP responses will almost always come with five different price tags. And there’s always a competitor that’s willing to eat your lunch.