OP-ED: CEOs require reputation assistance

In today's scandal-plagued corporate world, CEOs have determined that PR is too important to leave in the hands of PR people. Rather than feel threatened, PR pros should take this as a positive sign, but they need to be prepared to help their bosses deal with some difficult issues - including the difference between mere "responsibility" and real accountability.

In today's scandal-plagued corporate world, CEOs have determined that PR is too important to leave in the hands of PR people. Rather than feel threatened, PR pros should take this as a positive sign, but they need to be prepared to help their bosses deal with some difficult issues - including the difference between mere "responsibility" and real accountability.

These conclusions can be drawn from the fifth survey of CEOs on issues relevant to corporate reputation, or what we call "Corporate Reputation Watch," which we co-sponsored with Korn/Ferry International. This year's survey for the first time covers Asia, as well as the US, Canada, and Europe, and it shows a remarkable consistency among CEOs on the issue of where the buck stops for reputation management. It stops in the C-suite, specifically in the corner office, as 65% of respondents claim that the primary responsibility for reputation management rests with them. In addition, the survey confirms that reputation management is a board-level issue that will influence the selection of the next generation of CEOs. Almost two-thirds of the CEOs surveyed say the ability to manage reputation will "carry a great deal of weight" in determining who will next occupy the corner office. And a large majority of respondents believe that managing reputation is far more important than it was five years ago. At the same time, responsibility for reputation management - and the supposed importance being placed on the function - doesn't seem to be translating into accountability in the sense of meaningful measurement. Only half of our CEO respondents claim to have any kind of formal measurement in place for benchmarking and tracking reputation. In fact, almost as many respondents (46 percent) said they measured effectiveness through published surveys like Fortune magazine's list of "most admired" companies, as they do through their own investment in formal research (51 percent). So, if the axiom "You can't manage what you can't measure" applies to reputation, as well as other management disciplines, why do half of CEOs seem not to be worked up about measuring how effective they are as stewards of their companies' reputation? Perhaps like Supreme Court Justice Potter Stewart, who said he wouldn't try to define hard-core pornography but knew it when he saw it, most CEOs know when a company's reputation is good or bad without having to measure attitudes and perceptions in any meaningful way. And if there's a whiff of corporate scandal in the air, to paraphrase Bob Dylan, you probably don't need a weatherman to tell you which way it's blowing. In line with that reasoning, many CEOs appear to see reputation management as "the absence of scandal or crisis." If you're not getting written up in the daily press - which, according to our CEOs, is second only to customers as a leading driver of corporate reputation - you must be doing OK. This "know it when I see it" attitude is underscored by yet another finding - that senior executives from companies with "tainted reputations" are harder pressed to find C-suite work than others. It's easy to figure out which companies are severely tainted - and by implication, which senior executives should be left languishing on the unemployment line. However, without measurement, it's much harder to assess who's doing relatively well or relatively poorly. If we accept the premise that reputation is an asset that firms need to manage actively, then some changes from an "all or nothing" attitude are in order. Our CEO respondents agree that corporate reputation has an impact on such tangible business outcomes as employee retention and motivation, revenue growth, and share valuation. If that's the case, then there's a clear need to move reputation from an "exception reporting" exercise to one that clearly measures (a) the true value of corporate reputation as an intangible asset, (b) how effectively the CEO and management team are managing the value of this asset, and (c) how it translates into the achievement of tangible business objectives. And there's just as clear a role for the chief communications officer in educating the CEO as to how to measure and track reputation, and how to translate this activity into tangible progress. Our survey indicates that the C-suite door isn't just ajar and needing a push from the CCO to break on through - it's wide open. CEOs are waiting for help in handling the responsibility for reputation management that two out of three of them say they accept. Indeed, the CCO's seat at the table is ready for the taking.
  • Harlan Teller is president of Hill & Knowlton's worldwide corporate practice.

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