CORPORATE REPUTATION CLEARLY LINKED TO FINANCIAL SUCCESS, PANEL SAYS
In our autumn roundup, we examine events, interviews and news that took place in the last quarter of 2018. At an October panel discussion, Communicate magazine’s Brittany Golob spoke with two others about the impact of corporate reputation on financial performance
The bottom line is and will likely always be one of the crucial factors to determining business success. But, for communications professionals, who focus on reputation, the links between the two are clear, but need to be reinforced at the highest levels of corporate leadership. The discussion was hosted by Repute Associates, a reputation protection consultancy, and chaired by founder Ed Coke.
Jim Connor, director of communications at Lloyds Banking Group, spoke of his time at Tesco where he had to deal with the fallout of the now-infamous horseman scandal. The proof was (not literally) in the Yorkshire pudding for the links between reputation and financial success. Tesco’s ability to get out in front of the crisis, communicate its positioning and maintain an aura of transparency about its proceedings saved it from the financial impact that hit fellow supermarkets affected by the crisis.
Shahar Silbershatz, CEO of Caliber, a corporate reputation consultancy, talked about research into the clear links between finances and reputation. He examined companies and their ability to differentiate themselves, as well as the role of measurement in proving the credibility of corporate affairs, as key drivers in linking reputation to finances.
Golob talked through case studies like VW’s emissions scandal – which had little to no impact on the bottom line – and United’s customer services issues – which have – as a way of understanding how best to communicate about a business, particularly in times of crisis, in order to protect financial success.
“There is a strong body of evidence that establishes a clear relationship between corporate reputation and the financial valuation of a company. But when it comes to showing a link between specific financial indicators such as revenues or profitability, a more accurate way of demonstrating the relationship is by looking at the financial impact of a change in reputation,” says Repute Associates founder Ed Coke.