08 May 2020
By Ron Murray and Tim Marshall
The true judge of a person’s character is often revealed in moments of crisis. The same is true of organisations. Crises like the COVID-19 pandemic test an organisation’s mettle and reputation like nothing else.
Colmar Brunton’s Corporate Reputation Index, a partnership with Wright Communications, is an annual survey of the reputations of Kiwi companies through the eyes of New Zealanders.
The Colmar Brunton Corporate Reputation Index top 20 change remarkably little from year to year. The latest index, announced on 8 May, puts Air New Zealand in top spot followed by TVNZ, Pak’n Save, Toyota, AA Insurance, Kiwibank, Fisher & Paykel, The Warehouse, New World, Southern Cross, Countdown, Bunnings, Zespri, Z Energy, 2degrees, Auckland International Airport, ASB, Briscoes, Stuff and Genesis - in that order.
While the main research was done in December 2019, pre-COVID-19, a supplementary market probe to see if the crisis skewed the findings, bore them out.
COVID-19 is the perfect lens to examine corporate reputation: why it’s important and the critical contributing factors. If reputation is the corporate armour that shields you through challenging times, it will have been thoroughly assailed by the pandemic.
Corporate reputation is arguably an organisation’s most valuable asset. It is vital to win and retain customers, develop strategic partners and establish sponsorships, as well as attract and retain employees. It’s a well-known adage that reputations take years to build and seconds to destroy. A strong reputation is like money in the bank that will enable an organisation to weather a setback or crisis.
Organisational culture is at the heart of defining and maintaining reputation. If your internal culture is strong – employees are valued, informed and involved – this will shine through to the organisation’s reputation with external stakeholders. For our client Toyota New Zealand, a constantly high performer in the index, culture gives shape, unity and a sense of purpose.
A great reputation is built on a strong organisational purpose, and it is no accident that leading companies in the index, like Air New Zealand and Toyota, have Corporate Social Responsibility (CSR) programmes that link to their organisational purpose.
The Corporate Reputation Index looks at four pillars that support reputation: Leadership and Success, Fairness, Responsibility and Trust. All are relevant at critical times, but I’d like to focus on the third pillar – Responsibility.
Organisations can excel in leadership, they can project a strong inclusive culture and spirit of fairness and can engender trust, but responsibility is the Cinderella pillar. Responsibility requires a consistent commitment to social and environmental activities. You are judged by what you do, and that means acting responsibly during settled times and unsettled ones.
A CSR programme formally captures an organisation’s work in this area and an enormous amount of work and resource can go into robust programmes for strategically chosen causes that give back to the country and the community. Taking a responsible position can’t be piecemeal; the pillar will collapse if the organisation is seen as weak on employee support, for example, or environmental measures.
Responsibility alone, however, won’t build an organisation’s reputation. The most influential factor in communicating CSR activities is still the traditional news media, whose independent scrutiny of both good and bad behaviours by businesses reaches a large public audience.
Organisations must manage the narrative: identify the stories to tell their good works – and tell them well. This is particularly true for B2B organisations whose public reputations, unlike B2C companies, are not based on consumer experience of product quality or customer service.
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