* Corporate Reputation – the most important company asset? * The current widespread public backlash against business and its perceived unethical practices has left industry leaders scrambling to protect and nurture their corporate reputations. While the concept of business having to earn its’ social – as well as its legal- licence to operate, is now well-entrenched with the major business leaders around the world, many now find themselves having to incorporate the two sources of capital – social capital as well as economic – into their business strategies, as both are seen as vital to overall organisational success. * As a response to public backlash, these Sustainable Business Development (SD) practices and Corporate Social Responsibilities (CSR) activities can be seen as the new standard benchmark to demonstrate corporate responsiveness to changing societal values and expectations. These practices are also the most effective way to protect and enhance corporate reputations. * While SD and CSR terms have come to be used interchangeably, SD is generally understood to refer to the acceptance of a new approach to business that seeks to safeguard the planet’s existing natural resources. And CSR is understood to refer to the corporation’s active role of enhancing the community life of the societies in which they operate. * At the same time, emerging research from corporations already engaged in SD and CSR practices indicates that this approach is delivering bottom line benefits. * How does reputation affect business?
* The recent spate of spectacular business collapses and the public backlash to business has resulted in an all time low in the public’s perception and confidence in business leaders. Such widening disparity between public expectations and business practices suggests that business leaders are out of touch with what matters to many of their stakeholders, and are inadvertently gambling with their corporate reputations. * The value of a corporation’s reputation
* The post Enron world has changed the rules for everyone. Society’s confidence in the ability of business’ to seek to balance what is good for society with what is good for the market place has worn thin. Despite the economic benefits delivered, three quarters of Americans believe big business is too powerful . A 1999 European study showed that 87% of European employees would increase their loyalty to a company if it were seen to be involved in activities that help improve society . The trend is similar in the US. A New York Conference Board study found that a high proportion of respondents (42%) believe that companies should be wholly or partially responsible for helping to solve social problems, whilst a further 33% said companies should focus on setting higher ethical standards and going beyond what is legally required. * Reputation is no longer about “feel good” statements captured in glossy brochures or even about substantial dollar contributions to well deserving charities and public works. Today’s measure is about organisational behaviour in the pursuit of business which is seen to be both measurable, and therefore, manageable. It is no longer possible to buy ‘respectability’ – an increasingly cynical public and media have come to recognise that it is not how a corporation spends its philanthropic money that makes a statement about its’ character, rather it is how it makes its’ money on a daily basis, and the types of relationships it promotes with stakeholders. * As organisations come under the magnifying glass, the values they state coupled with the how they live up to those values within their own organisation and in their global supply chains, is defining what stakeholders feel about them. Ultimately it determines whether they will do business with them. A Reputation Quotient or antenna has become core intelligence for business leaders in the Twenty First Century. * Reputation management