This week Linda Locke from Reputare Consulting shared some thoughts and observations from the Reputation Institute’s Annual Conference in Rio. We thought our readers would be interested in Linda’s insights.
Notes from the Reputation Institute’s Annual International Conference on Corporate Reputation, Brand Identity and Competitiveness
Linda Locke
6.16.2010
Linda Locke is the principal of Reputare (rep-u-ta-re) Consulting, a corporate reputation consulting practice. She began the firm after a 14-year career at MasterCard International where she oversaw global reputation management as SVP and group head. She is a regular speaker on corporate reputation and recently spoke at the Reputation Institute’s 14th annual international conference on Corporate Reputation, Brand, Identity, and Competitiveness. Its theme was:
The Sustainability Imperative: A strategic role for reputation management.
Q. Why did you go to Rio?
A. I thought the theme was very timely given the current business environment. I think the notion of sustainability as a core organizing focus for rebuilding trust is a relevant one, but the definition varies widely.
Q. Do you think sustainability should be the key focus for a business wishing to rebuild trust?
A. Americans often define sustainability differently than other parts of the world. We tend to think of nature and the environment, whereas many others define it as connected to social justice. But as we coalesce around the idea of sustainability as a broader topic, I think it offers relevant framing for the intersection where what is good for business is also good for society. Outside the US, though, I think many people view the notion of sustainability as a challenge to free market capitalism.
Q. Give me an example of the definitions of sustainability
A. One speaker referred to sustainability as another name for democracy, and social and economic justice. One drew a venn diagram showing the intersection of humanism and capitalism.
Q. What are the implications of a sustainability strategy for a company wishing to build trust?
A. Charles Fombrun, the founder of RI, talked about how corporations wishing to build trust need to think about not what they want to say to the world but what the world wants to hear from us. Also a number of speakers talked about how making money is not an impediment to building trust – and the notion that stakeholders want companies to do both is a key issues.
Q. The Reputation Institute collects some interesting data on reputation and trust. Anything new at the conference?
A. For the first time RI created a global reputation Pulse report that identifies companies with the same global footprint, and then ranked the reputation of those companies. The study released showed that Google and Sony have the best reputations among the 25 or so companies rated.
Q. What are the obstacles to a company wishing to build trust?
A, One of the interesting ideas was from Professor Cees van Riel (Rotterdam School of Management, Erasmus University) who talked about the need to reduce fear. He called “corporate silence” an impediment as managers are often afraid they will lose face if they don’t know all the answers, and people lack courage to raise dissenting voices. Rebuilding trust will require companies to do the right thing, but also to do things right, according to Charles Fombrun, and that’s why internal alignment is a key issue.
Q. You have spent much of your career focused on financial services. That is an industry with severe trust issues. What do you think that industry needs to do to rebuild trust?
A. When I was in financial services I commissioned quite a bit of research on industry perception studies and what became clear in the US, and clear in many countries around the world is that banks should focus on two primary issues: ethics and fairness, as defined by the end users of banking services.
Linda Locke, Principal
Reputare Consulting
314.435.3428
linda.locke@reputareconsulting.com
Hello Linda,
Welcome back from Rio. I write to take issue with the scope of reputation management defined by the statement, “corporations wishing to build trust need to think about not what they want to say to the world but what the world wants to hear from us.”
In a world where almost everyone with a keyboard and a blog is a self-appointed investigative journalist, traditional corporate communications are far less compelling than deeds shared by independent third parties or communicated through extra-financial channels.
I also have a query. Did speakers at the conference address the range of substantive actions that might foster trust, and what fraction of those of advocated actions recommended change that would be consistent with a public firm’s fiduciary duties to its stakeholders?
Cheers,
Nir
Hello, Nir. I completely agree with your statement in your second paragraph. The point meant in the sentence you quote from me was that corporations should consider perception-centered strategy so they aren’t surprised by external reaction to activities that seem perfectly logical inside the board rooms and meeting rooms of the corporation. There are new tools available that make it vastly easier to get a sense of external perceptions and the drivers of psychological reactions such as outrage. The corporation concerned about its reputation – how it is perceived – will set up a means to listen to its stakeholders, and build what they hear into strategy.
Every speaker at the conference focused on actions that will build trust. The framing in all the presentations I attended (or made) was the notion that the market rewards companies that are trusted, and trust is built by the business decisions made by each corporation. That’s why people like me are not focused on philanthropy or CSR but an understanding of what drives reputation risk and how to build reputation sensitivity and understanding enterprise wide.
Best,
Linda