Championing stakeholder relationships with data-driven solutions
Categories: COMPANY NEWS , Enterprise
Corporate South Africa has over the past year learned many lessons in reputation management and the real value of stakeholder relationships.
“Last year we saw a number of well-known corporates lose reputational ground. We saw how ethical business conduct plays an important role in determining stakeholder perceptions of an organisation and now, more than ever before, data-driven reputation solutions need to be top of the mind when formulating stakeholder communication strategies for large and small firms alike,” says Regine le Roux, Managing Director of leading reputation research organisation Reputation Matters.
Reputation Matters’ proprietary reputation measurement tool, the Repudometer®, quantifies an organisations’ reputation. The model measures ten key elements which make up a reputation. Since 2005, the company has worked with various organisations, using reputation research results in managing and advising on how to effectively take a business reputation to the next level.
Le Roux shares insight on the noteworthy trends from reputation research conducted with nine organisations in 2017. “When looking at the average reputation scores from last year’s research, it becomes very clear that Corporate Social Investment (CSI) projects are increasingly important to stakeholders.
“People want to know they are doing business with socially responsible organisations.
“This element received an improved overall score of 80% in 2017 (rising from 73% in 2016) and we believe it will follow an upward trajectory again this year, becoming ever more important in impacting overall reputation scores.
“The rise of conscious consumerism led organisations to invest in sustainable social projects.
“The crux here is that stakeholders must be informed about these initiatives as this has a direct impact on their reputation score,” adds Le Roux, and she cautions stakeholders will very quickly decide if a CSI project is just a marketing ploy or if it reflects genuine care and effort to make a sustainable difference.
The biggest average score change was for ‘corporate governance’; the score dropped from 85% in 2016 to 80.1% in 2017. “This is not surprising as respective boards and leaders are being held more accountable by all stakeholder groups for their actions.
“Last year we saw reputations being ruined overnight as big firms were found with egg on their faces, and splashed across the headlines.
Various business scandals took centre stage, explaining the growing trend we have picked up in our reputation research results showing the increasing importance for transparency from top executives and ethical leadership.”
Interestingly, there was a dip in operational capital from 83% in 2016 to 78.5% in 2017, which could be a result of the challenging economic environment; budgets are clearly being invested a lot more conservatively when it comes to training and investing in equipment and technology. Linked to this we also saw a drop in internal communication from 85% in 2016 to 80.5% in 2017. This means organisations will need to make internal stakeholders a priority to help build their organisation’s reputation.
A stakeholder inclusive approach is important for true business growth and lends itself to becoming a trusted, reputable brand,” says le Roux, adding that it’s a requirement of the King IV report.
“Strong leadership at the helm of any organisation is vital, no matter how big or small the entity is, and good corporate governance and effective internal communication should be non-negotiable in all organisations.
“Being a responsible corporate citizen is not only crucial for profits, it is a must for creating a sustainable business landscape,” concludes Le Roux.