Reputation Is Our License To Operate

WHY does corporate reputation matter?

Organizations and businesses with strong positive reputation attract the best talent. When they are perceived to provide more value, they have more rooms to charge for a premium. Their customers are more loyal and avail of a broad range of product and services. Their government and community partners also prefer them as partners of choice. Listed companies who enjoy excellent reputation are also rewarded with support from their shareholders believing that these companies will deliver sustained earnings and future growth.

Therefore, there is more to corporate reputation than publicity work which unfortunately continues to be the prevailing sentiment among many Filipino companies and PR practitioners.

This is why, even at this stage, there is a need to emphasize what constitutes corporate reputation. Many scholars and practitioners have their own definition but we can all rally behind some of its most important elements i.e., corporate reputation is the overall quality of your company’s (brand’s) footprint across every communication channel and each segment of your target audience, consumer, and stakeholder.

It is never a “one-off” activity as reputation is built and cultivated over time. Considered more like an evolving process rather than a final outcome, reputation is the sum of how internal stakeholders think and feel about your company and brand. Reputation is what shapes how your audiences, consumers, stakeholders interact with your organization now and in the future. In our agency, PAGEONE Group, our mantra is, “Reputation is our license to operate.”

To be considered reputable, there are several elements that you must consider. These include ethical behavior (how well your organizations follow ethical standard in all transactions and operations); workplace culture (your firm’s commitment to all employees to maintain a fair, transparent and supportive work ethic and environment); customer focus (the value you place on customers by delivering services that satisfy them); social responsibility (your company’s engagement to adopt to social responsible business practices); service quality (your consistent delivery of quality service to your customers and stakeholders); executive leadership (how well your senior leaders represents and promotes the company and the brand); and media presence (how your organization is framed in every review, article and comment).

These elements do not only affect your brand image but also how your customers, employees, vendors, investors, competitors, and leaders perceive and engage with your organizations. Clearly, corporate reputation management is not only the remit of the communications and PR teams in your organization but the responsibility of everyone —most importantly, the senior management.

Hence, in my previous life as a senior corporate executive, I have always involved senior leaders in reputation management projects and activities. We created a brand and reputation committee that included all the business unit heads with the president/chairman as chair and me (representing communication and public affairs) as co-chair. In this committee, we discussed everything that will impact our reputation – from competition, regulatory kinks, community requests, product promotion, market access and investor relations among others. We did this because we realized that our stakeholders use our positive corporate reputation to gauge our strengths, decide on what to with our perceived weaknesses and then act on how far they should go with our businesses.

Truly, without a positive company reputation, it is difficult to attract new customers and maintain customer loyalty, or find that elusive talent that you need to achieve corporate and business goals.

As some management scholars argue, a robust corporate reputation:

  • Embodies integrity and generates trust among consumers
  • Strengthens your presence in your industry and online
  • Appeals to high-quality job candidates and improves employee retainment
  • Protects your brand during times of crisis and attack
  • Fortifies an image that vendors, suppliers, and partners want to do business with
  • Clearly, a positive reputation will enable your organization to withstand criticisms and crisis that can quickly turn into a PR nightmare which can seriously damage your brand.

To generate and manage positive reputation for your organization, there are a few things that you need to do. First, you need to assemble a good team armed with multiple competencies ranging from PR professionals, digital scientists and content marketers, public affairs specialists, investor relations experts, community affairs managers and the like. While budget may be a concern, you need to argue that to build and maintain a more positive reputation across all stakeholders, you must work with a team with the right level of expertise, experience and connection.

Second, you need to know the full extent and reach of your corporate reputation across all stakeholders; hence a brand audit is necessary. By performing an audit, your team will have a better idea of where you stand from your stakeholders’ point of views. The audit may also provide you information about existing threats to your brand reputation and identity; consistence of brand messaging including how they are being received and perceived by your customers; brand awareness and impact across local, regional, and national segments of your audiences and consumers.

Third, you also need to conduct a competitive analysis to find out how you are measuring up against competitors. Armed with informed insights, you can deploy strategies that will improve your performance vis-à-vis competitors as the competitive analysis will help you identify areas in which your company is doing well and where you may be lagging behind.

While many Filipino companies perform well managing corporate reputation, they lag behind and do an inadequate job of managing risks to their reputations in particular. From my observations, they tend to focus their energies on handling the threats to their reputations that have already surfaced. This is not risk management; it is crisis management—a reactive approach the purpose of which is to limit the damage.

In my more than three decades of management experience, I have observed three things that determine the extent to which a company is exposed to reputational risk. The first is whether its reputation exceeds its true character. The second is how much external beliefs and expectations change, which can widen or (less likely) narrow this gap. The third is the quality of internal coordination, which also can affect the gap.

We shall discuss these issues in future articles. I also intend to write about how to measure corporate reputation which is yet another area that a number of Filipino executives do not invest in. In the meantime, let me announce that I am putting up a professional organization that will promote the practice of reputation management in the Philippines. It is called Reputation Management Association of the Philippines (RMAP). Please check our web site for updates

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