Most CEOs still only pay lip service to reputation issue

NEW YORK: Despite a growing awareness of the link between corporate reputation and the bottom line, most companies are still only paying lip service to it.

NEW YORK: Despite a growing awareness of the link between corporate reputation and the bottom line, most companies are still only paying lip service to it.

NEW YORK: Despite a growing awareness of the link between corporate

reputation and the bottom line, most companies are still only paying lip

service to it.



That was a key finding of the second annual Corporate Reputation Watch

survey, backed by Hill & Knowlton and Chief Executive magazine and

conducted by Yankelovich Partners.



The survey, based on responses from almost 600 chief execs and other

senior-level managers, found that the percentage of companies measuring

corporate reputation doubled compared with last year - from 19% to

37%.



Even so, this latest figure represents less than half of

respondents.



H&K US president and CEO Tom Hoog said he was not disheartened by the

figure: ’Based on the numbers we saw last year, we had to be realistic.’

Asked if he thought it would double again next year, Hoog said, ’It’s

hard to expect that, but it will go up significantly.’



’CEOs are moving from being curious (about corporate reputation) to

being serious about it,’ said Ken Trantowski, EVP/GM for reputation

management at Edelman. ’But they’re still not convinced that it’s making

an impact.’



The survey also found no link between reputation management and CEO

compensation, with only 12% saying it carries a great deal of

weight.



’This is surprising,’ said Yankelovich EVP Hal Quinley. ’Companies know

this is important, but clearly it’s not institutionalized in terms of

monitoring or compensation.’



There is light at the end of the tunnel, though - almost half (43%) of

the CEOs who responded said the ability to manage reputation would carry

’a great deal of weight’ in their eventual choice of a successor. But

this figure sank to 32% for companies with revenues over dollars 500

million.



’CEOs increasingly see reputation as an extension of their corporate

brand,’ said JP Donlon, editor-in-chief of Chief Executive. ’The wonder

is that relatively few actually measure how they are doing.’



Consumer service and healthcare companies were found to be the best at

having formal measurement systems in place, while manufacturing firms

were the worst.



Last year, Donlon criticized existing corporate reputation tools,

calling them ’kind of squishy.’ Hoog said that progress has been made on

that front, but admitted that reputation measurement remains ’all over

the place ... I don’t think there’s a silver bullet.’ Added Quinley, ’We

have a long way to go.’



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