REPUTATION MANAGEMENT: Reputation - the reality PRWeek asks a selection of CEOs about how they view reputation and the role that PR has to play

Reputation, reputation, reputation; with the plethora of surveys,

rankings, and awards currently available, rating brand value and

business leadership, it is fairly clear that corporate image is a big


While a company's employment, environmental and social policies have

never been far off the business agenda, reputation management is now a

huge topic that seemingly, can only get bigger.

In December last year, Management Today ran its annual survey of

Britain's Most Admired Companies, revealing which operators in each

industry sector were rated most highly by their competitors.

In the wake of the boom and bust, this report reflected on how

tenuous corporate reputation can be, but - more interestingly - it

examined which factors the UK's business leaders rate in terms of

corporate reputation.

At the top of the list was financial soundness - swiftly followed by

quality of management.

However, capacity to innovate came only sixth, while community and

environmental responsibility - the consumer's favourite - scored lowest

of all.

This month, to really get under the skin of what chief executives think

about managing reputation, Hill & Knowlton published its global

Corporate Reputation Report in conjunction with HarrisInteractive.

This survey examines the attitudes of senior executives from a range of

companies across eight geographical markets: the US, Canada, France,

Germany, Belgium, Italy, the Netherlands and the UK, to the value of

corporate reputation, its influencers and the internet.

It comes as no surprise to discover that respondents rated the CEO as

the person primarily responsible for managing corporate reputation. But

perhaps more telling was the finding that the cult of the CEO is more

pronounced in the US than elsewhere.

'This probably reflects the higher percentage of shareholders in the

States and the fact that, for the US, business is the new

entertainment,' says H&K deputy chairman Andy Laurence. 'But the key

question is: "Will we see this trend over here?" and I think the answer

is "yes", the role of the CEO is going to become more intrinsic to

reputation in the UK,' he adds.

But, while corporate reputation can be fragile, equally it can be

subjective, so are the UK's business leaders right to be worried about

their reputations?

According to Stewart Lewis, MORI head of corporate communications

research, CEOs are indeed becoming more concerned about corporate

reputation and the factors that influence it.

MORI's annual Captains of Industry Survey 2000, revealed that 67 per

cent of respondents said the corporate brand would become more

important, compared to a mere two per cent who reckoned it would


'The evidence says CEOs are right to be concerned, because they sense

the growing importance of reputation to their key audiences: employees,

customers, legislators and investors,' he says.

With legislation and financial governance increasingly moving towards

placing a pound sign before reputation, while the big oil giants such as

Shell and BP produce extensive social and environmental reports for

shareholders, the stakes are getting higher.

As audiences' expectations rise, companies have to run faster, just to

stay in the same spot. Meanwhile, the growing power of the investor

demands that CEOs constantly provide an improved financial


The other factor to consider is that reputation is made of many parts

and poor performance in one area can completely overshadow excellence in


'Our research shows that if companies fail to treat their customers

properly for example, then it's very hard for them to be taken seriously

on the other things they do, in relation to how they treat employees,

environmental responsibility and community involvement,' says Lewis.

Recently, this has been an issue some of the high street banks have been

forced to face.

The crucial question, then, is what exactly do the UK's captains of

industry understand by corporate reputation, and what do they think

their PROs should be doing to protect, enhance and manage the corporate



'Building and nurturing a company's corporate reputation should be a key

priority for all companies - and this is not merely a case of obtaining

juicy headlines. For Camelot it is a case of being truly trusted as the

operator of The National Lottery as well as being respected as a

business,' says CEO Dianne Thompson.

'When the lottery was set up Camelot was hit by issues about how a

private sector company running something for the public good should

behave, with allegations of excessive profits and "fat cat" director's


'While it is clear that Camelot's fight for fairness during the very

public licence battle last year started changing public perceptions of

Camelot, we had already begun examining Camelot's accountability to all

these stakeholders who have legitimate expectations of Camelot as

operator of The National Lottery.

'We did this through a far reaching social and ethical report, that

looked to take social responsibility and ethical concerns to the heart

of the business, and to embed best practice across all areas of the


This began an active and ongoing dialogue with all stakeholders.

'However, the audit was just the starting point - it is now a case of

embedding the lessons learnt across the business. We are in the process

of making 90 changes in response to stakeholder concerns, many of those

we have already made are in our second social report.

'These included ones that captured the headlines such as the reduction

in pay and profits for the second licence, as well as those, which

although equally important, do not gain such prominence, such as the

development of a design tool which will minimise the potential risk of

new games to vulnerable groups.

'Our 1999 social report received great acclaim among its peers for its

achievements, gaining three awards. But it is not merely opinion-formers

we as a company are interested in reaching, we want to reach all

stakeholders involved in The National Lottery.

'In 1999, only 43 per cent of adults felt Camelot was a responsible

company, but by 2001, this has grown to 52 per cent.

'Good communications has an important role in protecting and enhancing a

company's reputation, but it cannot be relied upon alone. We often have

tough decisions to take which are bound to alienate some people.

'For example, much has been written recently about our refusal to pay

out the pounds 3m "unclaimed prize", which some have said is a case of

bad PR.

'While we would not court controversy, we made the decision we had to

make to uphold the integrity of The National Lottery, as people will

only remain confident in it if they believe the rules which govern the

game are upheld.'


'Every organisation is unique and its reputation springs from the

company's roots, its personality, its strengths and its weaknesses.

Corporate reputation affects the whole business, from the recruitment

process to the health of its sales figures and share price,' says UK

chief executive Paul Spencer.

'Reputations are built over time and need to be actively managed. At

Royal & SunAlliance, our reputation has been built over nearly 300

years, and we have invested in a strong internal and external

communications team, as well as external consultants to help maintain

our reputation as a leading force in the UK insurance market.

'The merger in 1996 presented both a challenge and an opportunity to

enhance perceptions and build a new corporate brand. We have worked hard

since our merger to establish the right reputation for the company, but

I am certainly not complacent.

'Reputation matters, and at Royal & SunAlliance in the UK we have a

number of audiences to consider from stakeholders to large corporates,

SMEs, intermediaries and of course, the consumer. All have different

demands and expectations from a large, established FTSE 100 company.

'Everything the company does, from internal employee communication to

announcing its results, must affirm its identity and reinforce its


The Royal & SunAlliance's corporate reputation in the UK is founded on a

range of factors.

'R&SA offers its customers total support in times of need. This was

particularly evident during the flooding last year. We provided

"on-the-ground" help and advice for our customers and strengthened our

emergency teams so claims were dealt with speedily and efficiently. As a

result, our swift actions generated extensive and very positive coverage

across both broadcast and print media 'You have to provide peace of mind

in a changing world with new and emerging risks, as our sponsorship

commitment to the Red Cross helps to demonstrate 'We understand the

changing needs of our business partners.

The recent launch of stakeholder pensions illustrates our approach to

working with intermediaries. This launch sparked a significant

regulatory change for the industry and employers alike. We worked with

our different audiences providing tailored information and advice 'R&SA

provides a holistic approach to customer service. We are continually

looking at new ways to improve service levels. This will be underlined

in the coming weeks with a multi-media launch of our new direct business

that provides personal financial solutions for our customers.

'Ultimately, reputation depends on how you deliver performance to key

stakeholder audiences. This is core to business success, and I certainly

feel it is something worth investing in.'


'Corporate reputation, preserving it and enhancing it, is at the heart

of every action taken by a CEO - whether it is talking to investors,

selling the company's product to a client, dealing with the government

or setting the policy for recruiting employees, and, of course, in one's

activities within the community,' says John Brackenbury CBE, chairman of

Pubmaster, Business in Sport & Leisure, and the Hospitality Training

Foundation and a member of the GoodCorporation advisory panel.

'This has to be so. Building the brand is crucial for share value and

for the continued performance of the business. It is, and must be, what

keeps the CEO awake at night. Reputation takes a long time to develop

but can so easily be destroyed by one simple mishap or oversight. I can

think of nothing more important in the CEO's areas of


Any CEO needs to ensure that every member of the board and all the

employees feel equally strongly about this issue.

'There was a time when a company's communications department was

basically playing the role of keeping companies out of the news as far

as possible, to avoid any negative publicity that might arise. Those

days have gone.

Stakeholders are becoming much more vocal in what they expect from

companies and the information they require.

'The role of corporate comms departments, enhanced by proper PR support,

should be to ensure that all the aspects of good practice of the company

are constantly reinforced and backed by demonstrable actions.

'This has been shown to pay handsome rewards. And yet, it still

astonishes me how many businesses fail to communicate the principles

they live by and do not make enough of their ways of doing business. For

example, every business recognises the importance of treating suppliers

fairly, but how many businesses actually publicise their best practice


'The truth is that it makes very good business sense for companies to

communicate their ethics, vision and fair treatment of stakeholders - in

other words their corporate socially responsibility - more effectively

and in a consistent manner.'


'I believe that corporate reputation has to be led from the top of an

organisation and that CEOs have to be at the frontline of their business

in order to manage it,' says the irrepressible P-Y Gerbeau, whose

reputation was actually enhanced as the Dome's plummeted.

'One of the roles of the CEO is to build up the confidence of external

and internal stakeholders. The biggest danger is that, if you don't

delegate and individual employees don't deliver the same message that

you do, you're absolutely finished.

'Core media strategy is vital - it influences the way your brand is

perceived and the way you symbolise your brand is far more important,

internally and externally, than just pure strategy.

'At the end of the day, it's the people who will walk into your shops,

and into your brand, that buy your brand on a daily basis.

'In terms of the CEO's communications skills in managing reputation, it

is important to play to their natural abilities. The job of the

communications consultant is to extract traits of that personality and

not to bury it in technique. If that consultant can extract that and

bottle it and make that what the media get to engage with, then you have

something very different from your average CEO.

'I really believe today the situation with reputation is not only about

financial or asset issues, it's about intangibles. And the three major

intangibles are around brand management, brand retention and people -

how you rejuvenate, how you motivate staff. It's about knowledge. How

you keep the knowledge, build on it, and keep customers happy.

'I think what's very important in a role of PR or communication strategy

is like any aspect of the business - trust and confidence.

'Central to the CEO's role in managing reputation is symbolising the

brand or "walking the talk". As soon as you're getting to personalise

the job then you have to behave like it, leading by example.

'You can't be a business person in one life and another in your personal

life, because people see through that, and if it's not the media,

financial analysts, the shareholders, it's going to be people inside the


The "ivory tower" syndrome has gone. It's not enough for staff to say

that their company gives them great benefits, good money, yet we have no

corporate identity.'

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