2. Can you define „reputation‟?
• broad measure of intangible assets or
standalone element?
• can you get your definition agreed internally?
Can you define „economic contribution‟?
• cash amount or other KPIs?
Can you validly and reliably measure it?
• opinion research
• share price
• econometrics
Now you can
prove the value...

3. “On average, corporate reputation is now accounting for
around 33% of the value of a FTSE100 company.”
Falls to 20% among FTSE250 firms.
“5% improvement in strength of current reputation could
be expected to add close to 2.1% of shareholder value.”
Reputation Dividend, 2012 Dividend Study
Oxford Metrica
“…there is an 80% chance of a [global top 1,000] company losing at least 20% of its
value (over and above the market) in any single month, in a given five-year period.”
Impact of crisis: Winners – gain 10%, Losers – lose 15% of shareholder value.
“It is the first few days following an event that the market makes its judgement…”

4. Jonathan M Karpoff (Prof of Finance, Washington Univ)
“I define reputation as the present value of cash flows earned when an
individual or firm eschews opportunism and performs as promised on
explicit and implicit contracts.”
The value of doing „the right thing‟ comes in improved net cash flow
and lower cost of capital.
“Reputational losses occur when a firm‟s counterparties – that is, its customers,
suppliers, employees, and investors – change the terms by which they are
willing to do business with the firm. Counterparties make such changes when
they believe that the chance of being harmed by a firm‟s opportunistic behaviour
increases…by guarding their interests against the possibility of being cheated,
[counterparties] offer a firm less attractive terms of trade.”

5. • YouGov partnered with PRCA to interview 13 leading
in-house communication directors about the role and
importance of reputation
• Across public/private sector including charities,
membership organisations, financial services,
technology sectors
• Separately, 33 in-house communication managers/
directors were interviewed quantitatively

6. Delivering what is expected...
For reputation to be true and pure
it has to be authentic
(Membership org.)
We do not have a set definition but we want our
company to be trusted and be seen as good
performers, match our rhetoric and deliver
(Public service provider)

7. Reputation…
• Without it the business is nothing
• Gives you a licence to operate, it is hard to earn but it pays great dividends
• Gives you a voice and allows you to sit at the political table
• With reputation comes trust and integrity – with a weak reputation you
don‟t have it
Everything we do is a reputation issue

8. Base: 33 Caution: results from bases <50 should be treated as directional only
Q: Which of the following best represents the approach taken to corporate reputation by your Board of Directors?

9. • Most agree it is their remit to plan both strategic and tactical
reputation management
• Reputation is increasingly higher on the agenda of the board and
management team than in the past – even more so in the future
• Communications teams are trusted to manage reputation more
proactively, particularly as the landscape is increasingly complex
due to social media
It has changed over my career to
boards trusting the PR person, working
in house more. When a crisis happens
they tend to want to take control but
when they see it is a competent team
they are more confident to let them
deal with it (Charity)
Reputation is top of mind as it impacts
the bottom line. I have monthly
meetings with the chief exec. On
reputation (Professional service)
We have total confidence from the
board in how the communications
team manages reputation

10. • Social media has impacted upon the speed that reputation
issues can spread, the reach and also the level of interaction
with customers and stakeholders
• This brings both fears and opportunities – managing it well
can reap reputation rewards, but in a crisis situation news
travels faster than ever
• There was no consistent way of managing social media
activity, but an overall tendency to hold in-house due to
required speed of response and intimate knowledge of the
business – keeping reputation close
• This has impacted on the relationship with external
agencies, as more tasks are managed internally
• Some are concerned/cautious around social media and steer
clear from communicating about company values and CSR
activities as this is “too risky”
It can be hard to combat and
manage…it can be incredibly
dangerous. To manage it well
you need to invest a lot into it
and have dedicated staff.

11. Reputation
Influence
Performance
People
As a charity people
choose to support us
due to our reputation.
If our reputation is
damaged it has a
massive financial
impact on our
operation. (Charity)
We have examples of where a
commissioner has told us that they
have chosen to work with us
because of our reputation and
you have done a good job here,
here and here. (Public Services)
Reputation is very important for people
to listen, it brings credibility – when
we are lobbying people are not going
to listen to us if we don’t have a good
reputation. (Membership Organisation)
Attract and maintain the
best staff. Staff want to feel
proud of their organisation
and thrive in organisations
with a healthy reputation.

12. 24% believe there to be an
extremely strong link
48% believe there to be a
reasonably strong link
6% believe there to be a reasonably
weak link
9% believe there to be no link at all
12% don‟t know
24%
48%
6%
9%
12%
Base: 33 Caution: results from bases <50 should be treated as directional only
Q: How much do you believe your Board of Directors think corporate reputation
is linked to the overall financial performance of your organisation?

13. Index is an average of 6
measures:
• Impression
• Quality
• Value
• Satisfaction
• Advocacy
• Corporate Reputation
Index is a longer-term measure –
it‟s great for looking at whether a
high impact event (which causes
short-term changes in Buzz) affects
a brand‟s equity in the longer term
What’s Index?
*4 week moving average
13/01 – Horsemeat
scandal hit the press
Tesco experienced the biggest hit amongst
the retailers in reputation during the crisis
– yet to fully recover it’s position by the
end of August 2013.

14. • Majority of organisations have some tools for measuring one
or more aspects of reputation
– Sentiment analysis
– Staff barometer
– Customer satisfaction
– Stakeholder surveys
– Qualitative research
• BUT most feel that it is a challenge to prove the impact of reputation on the
bottom line. Most examples are „anecdotal‟ rather than using data to support
Data is an indicative, but it cannot be prescriptive –
you cannot make conclusions from it, you can use
the data to understand perceptions of the
organisation, to inform strategy, understand priorities

15. Expertise Support
You need experts to hold up the mirror
and help us understand and improve
External agencies are excellent in the
time of reputational crisis. They can
ground you and understand how it will
play out. They can hold your hand when
the internal team is in a hail storm

16. External agencies are at a disadvantage
Trust is something you earn, so if they don‟t know the agency that well it is
difficult to have that trust. They want someone in house on top of this.
The industry itself has a questionable
reputation and is bad at communicating
about itself
We are precious about our reputation – they
(external agencies) don‟t have the same
passion or investment in the business
They won‟t know as much as an insider,
they are not as close to the decision
making process

17. Reputation has enormous value: it is a board level concern
and 72% say the board believes it has a strong link to financial
performance.
Metrics must be in place to value your effort and prove the
industry‟s worth.
A hard economic value will always be difficult to isolate but
„loss‟ is a good place to start.
Non-economic KPIs may be sufficient if have management
buy-in (e.g. Barcelona Principles). Think about Performance,
People & Influence. Aim high.
Agencies can have a role in this process, helping clients to set
measureable, economic objectives and then quantify them.