By Sandra Macleod, Group CEO, Echo Research and Britain’s Most Admired Companies
COVID-19 forced itself on an unsuspecting world with tragic consequences. As global leaders in research on reputation and the drivers of behaviour, we sought to assess the pandemic’s impact on trust and reputation among business leaders and the general public.
A clear way of viewing reputation is as a simple formula: ‘Reputation = Performance less Expectations,’ (R=P-E).
As such, we believe that understanding the changing world of expectations is fundamental to managing reputation, determining risks and ensuring successful outcomes ahead.
Reputation matters because it drives trust and importantly, behaviour.
Our Reputation Dividend research shows it accounts for some 30% to the market capitlisation of companies in the FTSE and internationally. As such, reputation demands assessment, systems and processes in place along with any other major asset class. You just can’t leave it up to chance.
On the one hand, many organisations are fighting for survival – just getting past the current quarter, just getting to Christmas. For them, the focus may need to be solely on delivering performance, without trying to manage expectations as well. So in terms of Maslow’s Hierarchy of Needs, reputation is there, but for many it may not be at the top.
For those that survive, COVID-19 will have been a test of the organisation, culture, and purpose.
Saints and sinners
The media has delighted in separating the saints from the sinners and profiteers.
Echo’s recent poll among the general public found a number of sectors are singled out for praise. These included food retailers (such as Tesco), the tech industry (notably Amazon), pharmaceutical companies (like AstraZeneca) and even insurers and brewers. These companies focused on customer care, driving innovation and rapidly escalating their digital offerings.
Some of the so-called ‘sinners’ the research pointed to were labelled so because they were overly ‘opportunistic’. Think Mike Ashley at Sports Direct or Sir Richard Branson.
The research shows we have little respect for those that behave badly and little tolerance for those flaunting responsible behaviour for the sake of a quick buck.
The need for change
The health crisis has accelerated calls for real, impactful systemic change in all directions – from climate change to diversity and equity.
Environment social and corporate governance (ESG) is now another word for corporate purpose and good governance. It’s inconceivable that responsible corporates don’t have those issues firmly on their radar and building in ways to address them.
We need to recognise how intense and challenging this period has been – and will continue to be.
I worry about the rise in mental health issues, the future for our young, the disadvantaged, the disabled and working mothers.
How do we collaborate well and effectively in this new norm? How do we help bring on those who need jobs and training when budgets are uncertain?
No organisation, no team is perfect. But we have shown that people can and do have the courage to drive change.
At an individual and managerial level, it is up to all of us to change the conversations and experience.
For those who want to be agents of real, sustainable change, there are four things you can do:
- invest in training and development so that people have a say on their day-to-day experiences and longer-term prospects and contributions
- build a coalition of people that want to drive change across the organisation, especially among the young
- be the behaviour you are hoping for
- and arm yourself with the data and evidence to take you and others firmly on this journey
In doing these things, we may be able to behave our way to creating a more responsible corporate culture.