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The most underrated CEOs

Fortune asked the 3,800 corporate executives, directors and analysts who decide its World Most Admired Companies list, which CEOs deserve more attention

CEO, Satya Nadella, Mary Barra, Microsoft, GM

The business acumen of Amazon CEO Jeff Bezos, Apple CEO Tim Cook and Tesla CEO Elon Musk is widely discussed and every word, dissected, analysed and absorbed.

Fortune asked the 3,800 corporate executives, directors and analysts who decide its World Most Admired Companies list – Apple the most admired for the 14th year in succession – which CEOs deserve more attention than they get.

Satya Nadella, the CEO of Microsoft, was judged the ‘most underrated’ for the fifth year in a row, with GM CEO Mary Barra picked as the second most underrated CEO.

Nadella has quietly but effectively transformed Microsoft since he took over from Steve Ballmer in 2014 to become the company’s third CEO.

Today, Microsoft has a market valuation of US$1.7 trillion. By September 2018, Nadella had tripled the company’s value, and in the 2019 financial year, he oversaw a record-breaking year.

“We delivered more than US$125 billion in revenue, US$43 billion in operating income, and more than US$50 billion in operating cash flow – and returned more than US$30 billion to shareholders. Our commercial cloud business is the largest in the world, surpassing US$38 billion in revenue for the year, with gross margin expanding to 63 per cent,” Nadella told shareholders.

In its latest financial report, the second quarter of 2021, Microsoft has continued to soar with revenue of US$43.1 billion, a 17 per cent increase year-on year; operating income was US$17.9 billion, a 29 per cent rise year on year; and diluted earnings per share was US$2.03, a 34 per cent increase.

“What we have witnessed over the past year is the dawn of a second wave of digital transformation sweeping every company and every industry,” Nadella said.

“Building their own digital capability is the new currency driving every organisation’s resilience and growth. Microsoft is powering this shift with the world’s largest and most comprehensive cloud platform.”

Commercial cloud revenue was US$16.7 billion, soaring 34 per cent year over year.

Nadella’s performance as CEO of Microsoft has been exemplary and the company’s performance shows no sign of slowing.

Mary Barra is the first woman CEO of a global vehicle manufacturer. She is also GM’s Chair. Barra was at GM through its darkest days and since her appointment to the CEO role in January 2014, she has streamlined the business, moving it into driverless and electric vehicles.

She has been fearless in her pursuit of a better company. She pulled GM out of its perennial loss-making Europe operations after 90 years, selling its Opel and Vauxhall brands to French vehicle maker PSA Groupe for US$2.3 billion in March 2017.

In 2017, GM released the Chevrolet Bolt EV, beating rival Tesla to the first electric car priced under US$40,000. It had a range of 320 kilometres.

In November 2018, Barra announced the closure of five North American plants and dismissed 14,000 workers. The next month, GM started production of its new Chevrolet Blazer SUV in Mexico to reduce its labour costs.

During the coronavirus pandemic in April last year, Barra organised the conversion of a car plant in Michigan, Detroit, to manufacture up to 50,000 face masks daily within seven days. GM then shared how to do it and encouraged other companies to do likewise.

In November last year, Barra said GM is accelerating an “all out pursuit of global EV leadership” and on 28 January Barra said GM would stop producing petrol and diesel-powered cars by 2035 and will make 40 per cent of its model range electric within four years.

Barra is also putting her credentials on the line, developing an Ultium battery at a new plant in Ohio, which will offer an electric driving range of up to 720 kilometres on a single charge.

GM posted an encouraging fourth quarter 2020 financial report, with domestic sales increasing 4.8 per cent during the last three months compared with the same period in 2019. The most popular vehicles are GM’s pickup truck and SUVs. Sales of the Chevrolet Corvette rose 20.2 per cent, Chevrolet Bolt EV increased 26.4 per cent, and Encore GX, a small crossover, topped the sales charts for Buick in its first year.

Barra’s GM may not excite investors like Tesla – which now has 10 times GM’s market capitalisation. Tesla sold only one-fifth as many cars as GM last year.

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