Managing Issues to Protect Reputation & Build Brand Equity

Recent research studies and industry reports haven’t had much good news to report regarding reputation and trust in business. Here is a quick glimpse of some damning stats:

• The 2009 Edelman Trust Barometer revealed that 77% of U.S. respondents trust corporations less than they did a year ago;

Fortune magazine reports that trust in business across 20 countries is down 62% over 2008; and,

• 88% of respondents to a Harris Interactive poll stated that corporate reputation is “not good” or “terrible.”

These numbers don’t bode well for communications executives, who are charged not only with defending their organizations’ reputations, but also with measuring the impact a given issue or crisis has had on that reputation.

The latter responsibility is especially important in a time when every business department is desperate to prove its value in quantifiable terms. But measuring the success or failure of a crisis response, or of the overall brand equity lost/gained, doesn’t start after things fall apart.

“Ninety percent of reputation management is prep work,” says Chris Johnson, president of dna13. “Know what’s being said about you all the time. Your stakeholders have the power to use new technologies and applications to damage your reputation, but you can use the same tools to protect it.”

Here are some specific techniques for doing just that.

â–¶ Measure your risks up front. Clearly, everything from the current economic crisis to the proliferation of social media is altering the landscape and increasing the risks. This is all the more reason for communications executives to assess potential land mines on an ongoing basis. To do so, Leslie Gaines-Ross, chief reputation strategist of Weber Shandwick, recommends taking the following steps:

• Benchmark, track and monitor company and industry issues;

• Monitor and measure social and traditional media, and use text analysis;

• Set Google and Twitter alerts;

• Audit industry awards and recognitions;

• Conduct custom research/polling of key stakeholders;

• Keep up with conferences and events to know trends and hot topics;

• Identify early warning signs;

• Know the academics; and,

• Consult with independent risk-analysis vendors.

â–¶ Assess the present information environment. According to Linda Locke, group head of reputation and issues management for MasterCard, there are three main elements that influence reputation: stakeholder experiences, corporate initiatives and messaging and third-party conversations.

“Stakeholder scrutiny has greatly increased regarding the role of business and its influence on society,” she says. “Absent firsthand experience, stakeholders modify their beliefs based on the information environment.”

Given this increased stakeholder scrutiny, made all the more important due to its profound effect on reputation, communications executives must develop a 360 degree view of the information environment from which their stakeholders are getting information.

â–¶ Use media analytics to gauge the information environment. “The media itself is a rich source of market intelligence that can be mined,” Locke says. “Messages in the media create a reaction, which shapes stakeholders’ beliefs about a company.”

Ernst & Young’s experience in the wake of Arthur Andersen’s implosion clearly illustrates the effect the media has on shaping stakeholder perceptions. Following the Enron scandal and subsequent fall out, E&Y endured Senate investigations, televised hearings regarding tax shelters and, of course, a deluge of negative media coverage.

“When fraud took place in a public company, the growing assumption was that the auditors didn’t do their job, or that they were part of the fraud,” says Ken Kerrigan, communications director of E&Y Americas. “The role of the auditor wasn’t designed to catch collusive fraud, but investors [were suggesting] otherwise. And almost everyone—media, lawyers, legislators and even potential recruits—was starting to agree with them.”

As this widespread distrust permeated media coverage, the communications team began analyzing trends that could help shape responses. What they found was surprising.

“Investors were not looking for apologies, but rather for a commitment [by auditors] to do more—for a reason why they should trust us,” Kerrigan says. “We needed to change our message, raise our voice and take action.”

Based on the information gleaned from media coverage and the broader information environment, the team revamped their entire strategy. Their new approach:

• Maintain an ongoing dialogue with all stakeholders;

• Fully cooperate with all hearings and investigations;

• Close their practice that marketed tax shelters;

• Settle the dispute with the IRS; and,

• Publicly support Sarbanes-Oxley legislation.

In addition to taking these measured actions, which were all based on intelligence gathered from media coverage and public sentiments, the team shifted its messaging strategies to focus more on its commitment to integrity.

“We set the tone from the top inside and outside the firm,” Kerrigan says. “We [communicated our belief] that no client was too big to walk away from and that it was everyone’s job to raise their hand if they saw something wasn’t right.”

As the E&Y example shows, there is no foolproof way to safeguard against crises, even if you are fully aware of the present risks. But it also demonstrates the ways in which communications can lead the way to recovery.

“Our ultimate goal as communicators is building trust among stakeholders,” Locke says. “You may be able to control the imagery, but you can’t control perceptions.” PRN


Ken Kerrigan,; Leslie Gaines-Ross,; Linda Locke,; Chris Johnson,