of reputation, roller coasters, and wilde rides on wall st
DESCRIPTION
Presentación de Charles Fombrun, Presidente del Reputation Institute, en le marco de la presentación del informe Reputation Pulse España 2010, el 7 de mayo 2010, en EOI, Escuela de Organización Industrial.TRANSCRIPT
Of Reputations, Roller Coasters, and Wild Rides on Wall St.
Dr. Charles FombrunChairman, Reputation Institute
Madrid, Spain7 May 20107 May 2010
Huge Centripetal Economic Forces are Pulling Us Apart
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While Geological Forces are Taking their Toll
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Contributing to a Wild Ride in the Financial Markets
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And Putting “Reputation” On Everyone’s Mind
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Toyota is Reeling from Unintended Effects of Cost-Cutting
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BP is Reeling from a Huge Oil Spill in the Gulf of Mexico
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Clearly Reputations are Always at Risk
"It takes 20 years to build a reputation and five minutes to ruin it.
If you think about that, 'll d thi diff tl ”you'll do things differently.”
Warren BuffettWarren Buffett
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RI has conducted Global Reputation Studies since 2000
34 Countries & 24 Industries –65,000 ConsumersAirlines & Aerospace • Automotive • Beverage • Chemicals • Computer • Conglomerate • Construction & Engineering • Consumer
Products • Electrical & Electronics • Energy • Financial – Bank • Financial – Diversified Services • Financial – Insurance • Food Manufacturing • Industrial Products • Information & Media • Pharmaceuticals • Raw Materials • Retail – Food • Retail – General •
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Manufacturing Industrial Products Information & Media Pharmaceuticals Raw Materials Retail Food Retail General Services • Telecommunications • Transport & Logistics • Utilities
Lesson #1: A Corporate Reputation is an Emotional Bond
…and built on 7 Pillars
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Lesson #2: Reputation Operates “Below the Line”
Strategic Goals
Business Results
CorporateInitiatives
Perceptions of Company
Supportive Behaviors
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Lesson # 3: Improving Alignment Increases Reputation
What Companies
SayInconsistency
Say
How Companies are Perceived
Inconsistency
What C i
InconsistencyCompanies
Do
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Lesson #4: Improving Reputation Increases Support
Improve Reputation by 10% – Increase Support by 10%
80
72
80
56
64
Rec
omm
end
40
48
nden
ts w
ho W
ould
R
24
32
% R
espo
n
8
16
26 36 46 56 66 76 86
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Adj-R2 = 0.889
26 36 46 56 66 76 86
U.S. Pulse Score
Source: 2010 Global Reputation Pulse (U.S. Results)
Lesson #5: …and creates Financial Value
Top 30 in Reputation
Bottom 30 in Reputation
Ratio of Market ValueMarket Valueto Book Value
3.79 1.42
% Change in Market Value = 1.3 * % Change in Reputation
So, on average:
13%10% Improvement in Reputation
13% Improvement
in Market Value
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Value
Lesson #6: So that Investing in Higher Reputation Firms Can Pay Off
40 .00%
HIGH REPUTATIONPORTFOLIO
CumulativeReturns
20 .00%S&P 500
0 .00%
S&P 500
-20 .00 %
-40 .00 %
-60 .00 %
Jan-00Apr-0
0Jul-0
0Oct-0
0Jan-01Apr-0
1Jul-0
1Oct-0
1Jan-02Apr-0
2Jul-0
2Oct-0
2Jan-03Apr-0
3Jul-0
3Oct-0
3Jan-04Apr-0
4Jul-0
4Oct-0
4Jan-05Apr-0
5Jul-0
5Oct-0
5Jan-06Apr-0
6Jul-0
6Oct-0
6
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Ja Ap J O Ja Ap J O Ja Ap J O Ja Ap J O Ja Ap J O Ja Ap J O Ja Ap J O
Lesson # 7: But Reputation Requires Vision & Governance
Energy Autogy
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Tobacco Banking
Lesson #8: And a Focus on Products & Innovation
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Lesson #9: Companies have to Do the Right Thing
“You can make money without doing evil”You can make money without doing evil
Is Google a great Is Google a great place to work because place to work because its stock is at $483, or its stock is at $483, or is its stock at $483 is its stock at $483 is its stock at $483 is its stock at $483 because it's a great because it's a great place to work? place to work?
----Business Week, January Business Week, January 22, 200722, 2007
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Lesson #10: As Well as Do Things Right
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So a Mind-Shift is Taking Place From Brand to Reputation
Brand ReputationBrand
The promise a company makes
Reputation
The degree to which the companyThe promise a company makes to its stakeholders
“Owned” by the company
The degree to which the company fulfills its promises
“Owned” by stakeholdersOwned by the company Owned by stakeholders
A brand is a promise…h li t th t i b ild R t tiwhen you live up to that promise you build Reputation
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Reputation Pulse 2010
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The World’s Best Corporate Reputations (2010)
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Corporate Reputations in Spain?
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