Thought piece

A couple of months back, I suggested we could define corporate reputation as “the stuff that sticks”. By that, I meant that all different types of stakeholders – consumers, regulators, politicians, media and investors – typically look for easy pen portraits to describe the reputation of a company.

In my opinion, this tends to mean the complex jigsaw of corporate reputation gets viewed through a very limited number of hugely important stakeholder expectations.

Recently, there have been several companies in the news for the wrong reasons where this easy shorthand still seems to apply, and is upholding generally positive reputations among consumers, despite sustained media pressure focused on poor corporate behaviour:

On the face of it, none of these negative stories seem to have damaged the bottom line of any of these companies.  The stuff that sticks – so far – is centred on the core talents of Uber, Ryanair and Amazon.

So, if you were in charge of these companies, what incentive is there to change your corporate behaviours when your sales seem to be unaffected?

The need to address these issues lies in the fact that reputation is holistic.  Consumers aren’t the only audience that can make or break a company’s reputation.  Ask more specialised stakeholders about the stuff the sticks in their minds about these companies, and I believe you’d get a very different response.  Are pilots truly unaffected by Ryanair’s handling of their cancellations crisis?  Will the Regulator back down and accept the ‘people power’ arguments of Uber?  And should Amazon simply ignore NGO calls for fairer treatment of supply chain workers?  The opinions of professional stakeholders matter.  Left unresolved, these negative perceptions can and will limit the business performance of these companies.

Limited or no damage to the bottom line does not equate to a robust reputation among all stakeholders.  The chances are strong that, if not dealt with through appropriate dialogue and communication, the underlying issues at all three companies will move over time from ephemeral media storms to long-term behaviours that will in turn be what Ryanair, Uber and Amazon become widely known for. And that sticky stuff really can hurt.

To shore up their reputations, Uber, Ryanair and Amazon need to change.  They should be concentrating their efforts on addressing professional stakeholder concerns rather than assuming business as usual if the sales impact is minimal.

To have a truly robust reputation, corporate Behaviours, Talents and Values need to be optimally aligned.  Identifying, measuring and understanding this balance is at the heart of the Repute Associates’ offer.