The role of reputation in driving corporate value has been welcomed by regional PR pros.
A new Weber Shandwick report - based on a survey with more than 2,000 executives worldwide - evidences a broad range of factors that act as reputation drivers; from the quality of services to the impact of corporate culture.
It examines what drives a company’s reputation, why it is important to be highly regarded and the benefits that come with having a strong corporate reputation. The study also touches on topics such as corporate culture, CEO and employee activism, crisis and risk.
'The State of Corporate Reputation in 2020: Everything Matters Now' finds that reputation is 'omnidriven', meaning a company’s reputation is influenced by a variety of factors, with no one driver having a greater impact than the rest. This lack of distinction suggests that companies can no longer solely focus on and prioritise just a few key drivers of reputation, but on many. From the quality of employees to quality of products, to financial performance, to corporate culture, everything matters to managing corporate reputation today.
"It has been widely accepted that reputation makes a meaningful contribution to business success," said Gail Heimann, president and CEO of Weber Shandwick. "Our study quantifies the remarkably high value assigned to reputation today and shows how it takes a fierce level of attention to an unprecedented suite of reputation drivers – nearly two dozen are deemed significant – to remain highly regarded and prevent reputation erosion."
In the study, authors note that as "global business markets head into a new and undoubtedly pivotal decade", business leaders must be prepared for the unpredictable and unknown.
It continued: "Reputational opportunities and threats lie in wait everywhere, internally and externally. The spotlight is more unforgiving as consumers shun companies when they lose trust in them or disagree with them about social issues. Reputation Institute has deemed this period of time 'reputation judgement day,' an era in which companies are 'scrutinised on all aspects of their company – ethics, leadership, values and beyond’.
"The year 2020 marks not just the start of a new decade, but a year in which business leaders all over the globe will need to hone their 20/20 visual acuity and raise their antennae to scan the reputational landscape on a 360-degree basis."
The report also found most reputational crises are self-inflicted. Among the global executives who report that their firms experienced a crisis in the past two to three years that impacted their reputations, most (76 per cent) claim that the crisis was preventable.
Corporate reputation is also on the radar of company leadership. Nine in 10 executives (91 per cent) say their company’s reputation is important to their board of directors, with about half (52 per cent) reporting it to be very important to the board.
Commenting on the research, PRCA Director-General, Francis Ingham said: "The research from Weber Shandwick is a powerful reminder of the influence public relations professionals have in driving corporate market value.
"The data show that the public expects businesses to contribute meaningfully to the societies they operate in. It’s our responsibility to ensure businesses and brands meet these growing public expectations.
"Our skills are at a premium: our ability to meaningfully connect people to businesses has never been more important than it is today."
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