Boardroom Battles, Brand Bruises: Why corporate power struggles are new reputational risk
From Nestlé’s CEO exit to Tata Trusts’ internal feud and Tesla’s shareholder showdown, public leadership conflicts are fast becoming the biggest threat to corporate credibility. Experts say how brands communicate during these crises can make or break their long-term trust.
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Once confined to closed-door boardrooms, corporate disputes are increasingly spilling into the public domain, often with dramatic consequences. In recent months, leadership tussles at Nestlé (with the firing of former CEO Laurent Freixe), Tesla (over Elon Musk’s contentious pay package), Tata Trusts (amid a power struggle between senior executives), and even the U.S.-based analytics firm Astronomer (after a “kiss cam” incident gone wrong) have thrust governance issues into the spotlight.
Each case underscores a growing pattern: when leadership falters in private, reputation suffers in public.
“Boardroom conflicts, when they play out publicly, do influence investor confidence and brand perception,” says Neha Mohanty, Founder and Director of StarFishGlobal Communications. “They create uncertainty regarding leadership stability and governance. Even if the fundamentals remain strong, perception drives trust—and that’s what gets shaken.”
The markets tend to echo this sentiment. When Nestlé’s leadership tensions surfaced, its stock briefly wavered despite solid quarterly earnings. Similarly, Tesla’s valuation has often fluctuated in tandem with its CEO’s public controversies rather than product performance.
Earlier, leadership disagreements stayed behind oak doors and typed minutes. Today, they spill out in regulatory filings, media leaks, and Twitter threads sometimes even memes.
Anup Sharma, Strategic Communications Advisor, notes that screenshots travel faster than press releases, and narratives form in comment sections before they do in board resolutions, in today's digital age. Investors don’t just react to performance; they react to perception. "If the leadership looks divided, the market assumes the strategy is too. It’s not the change that rattles people it’s the uncertainty."
Today’s founders and CEOs are not faceless executives; they are influencers, storytellers, and in many ways the brand itself. So when a boardroom battle becomes public, it plays out like a Netflix drama except the audience includes shareholders, regulators, employees, and media all watching in real-time.
The Domino Effect of Corporate Drama
According to Samit Sinha, Managing Partner at Alchemist Brand Consulting, “Boardroom battles, when public, almost always carry image repercussions. They can dent investor confidence and unsettle key stakeholders: employees, trade partners, collaborators.”
He notes, however, that consumers are often less affected by boardroom politics than by operational performance. “For the general public, such conflicts often serve as vicarious entertainment. But as long as end-users continue to trust the product, confidence eventually returns.”
Still, experts agree that the short-term reputational cost can be severe, particularly in a social media age where narratives move faster than facts. A single leaked memo or executive comment can spark days of speculation and viral debate.
“Instability at the top creates ripples,” says Chetna Israni, Co-founder of Morning Star BrandCom. “It’s human nature to equate leadership conflict with organisational weakness. But one public disagreement doesn’t define a company’s destiny, it’s how the brand resets that matters.”
Controlling the Narrative Without Losing Credibility
For brands, the greatest challenge lies not in avoiding controversy but in containing perception.
Mohanty argues that credibility hinges on clarity and consistency. “The best method is to communicate quickly, clearly, and with one voice,” she says. “The focus should be on facts, not speculation, while reinforcing governance and continuity.”
Sinha adds a word of caution: “Prevention is always better than cure. But when containment fails, direct and transparent communication with internal stakeholders is key. Overexposure through the media often backfires, it keeps the controversy alive and can make leadership seem defensive.”
Israni, meanwhile, stresses the importance of emotional intelligence.
“Credibility isn’t built by rushing to control the story, it’s built through empathy and ethical communication,” she says. “Acknowledge what went wrong, outline corrective steps, and stay consistent. Audiences today are far more forgiving of honesty than of spin.”
She points to Astronomer’s recent controversy as a case study.
“It caused a stir for a few days and then people moved on. The brand’s decision to address it, reset, and maintain composure helped it recover quickly.”
Lessons for the C-Suite
As boardroom showdowns become public theatre, communication is no longer just a PR issue, it’s a leadership skill.
The takeaway from experts is clear:
Contain before you communicate. Keep internal matters internal until you have a unified stance.
Respond, don’t react. Measured, fact-based statements preserve credibility better than emotional defences.
Reinforce continuity. Stakeholders must see that business stability remains intact despite leadership changes.
Show integrity and empathy. Brands that own up to missteps often emerge stronger in the long run.
In the era of radical transparency, how leaders handle conflict in the public eye determines more than just market sentiment, it defines the trust capital their brand can bank on for years to come.
