One of the important factors that the famous investor Warren Buffett of Berkshire Hathaway fame uses to work out if he’d invest in a company is the quality of its leadership. Given our super money is wrapped up in a lot of companies listed on local and global stock markets, this Buffett tip looks really important as Nestle’s CEO has been shown the door for behaviour unbecoming.

This is hot-on-the-heels of a US-based CEO of a company called Astronomer, who was seen smooching with his marketing colleague at a Coldplay concert. Their love tryst was captured on TV and became a global hit on social media platforms!

While CEO Andy Byron fell on his sword, undoubtedly, he could see the daggers were out from the board and weren’t far away, so he headed for the exit.

The Daily Telegraph reports that the “Swiss food giant Nestle has fired its CEO over an affair with a junior colleague”.

In case you don’t know what Nestle owns, think Milo, KitKat, Nespresso and others in the retail food space.

The company’s board didn’t muck around and chief executive Laurent Freixe was shown the door. This guy only got the gig a year ago and was promoted to the chief executive role to lift sales not court young staff, after the share price has slumped.

In Australia, many of our best companies have quality people heading them up. This doesn’t mean they always make great decisions but given their importance to their staff, their shareholders and customers, you need leaders who are worth investing in.

One company, Wesfarmers, that owns the likes of Bunnings, K-Mart, Officeworks and Target, has had a history of pumping out quality leaders, who did such a good job cultivating leadership in the business that CEOs and chairmen have all been homegrown.

And it’s reflected in the share price over time, as the chart below shows.

When a company’s share price in a non-tech, low-hype space goes from $10 to $88 over 25 years or so, its leaders are doing their job, not caught ‘on the job’!

If you let your investing money keep good company, it is likely to experience good growth.