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Corporate Reputation Study Shows Impact of Current Events

The seventh annual Reputation Quotient study shows that the overall reputation of American corporations, which was already weak, slipped further in 2005. This year, 71 percent of respondents rated American businesses'' reputation as "not good" or "terrible," compared with 68 percent in 2004. So, despite corporate-governance reforms such as Sarbanes Oxley and a growing commitment to ethics and social responsibility, companies haven''t redeemed themselves with the public.

 

The Reputation Quotient study, which offers an established approach for measuring corporate reputation, was conducted in two parts. Between March and June, 6,977 respondents were asked to name the two companies with the best reputations and the two with the worst. The 60 companies named most often were then rated by 19,564 people in a separate survey between Aug. 30 and Sept. 26. Harris Interactive in association with the Reputation Institute, developed the tool to help understand the foundation of a corporations'' reputation, as well as the perceptions that are most closely associated with consumers'' behavior when it comes to purchasing a company''s products and stock.

 

RQ research evaluates stakeholder perceptions across 20 attributes that are grouped into the six dimensions of reputation:

  • Products & Services
  • Financial Performance
  • Workplace Environment
  • Social Responsibility
  • Vision & Leadership
  • Emotional Appeal

Interestingly, many respondents to the survey did not give corporations much credit for their respective philanthropic ventures over the past year, which included response to the devastating tsunami as well as hurricanes Katrina and Rita. In fact, many respondents called on companies to give more and make their good deeds more visible to the public. Procter & Gamble Co. was one of the companies that respondents criticized for not doing enough to demonstrate social responsibility. Partly as a result, P&G dropped from fourth on the list in 2004 to 13th in 2005.

 

The question of whether or not to publicize social activism is up for debate, of course. We typically encourage clients to announce their good deeds but to understand that their largesse should primarily help achieve organizational objectives other than visibility. If they are publicly recognized, that''s great, but the desire for credit should never be a driver.

 

Not surprisingly, current events played a role in how some corporations were ranked. For instance, the three oil companies in the survey -- Exxon Mobil Corp., Chevron Corp., and Royal Dutch Shell PLC -- were ranked among the bottom 15 at least partly due to the spike in the price of gas at the pump. Meanwhile, Halliburton finds itself among a rogue''s gallery, narrowly placing higher than Adelphia, MCI (WorldCom) and Enron. On the flip side, all the glowing praise of Google certainly contributed to its incredible debut at number three.

 

Here is the complete listing:

1

Johnson & Johnson 80.56
The Coca-Cola Company  79.69
3 Google 79.52
4 United Parcel Service (UPS)  79.37
5 3M Company 78.78
6  Sony Corporation

78.75

7

Microsoft Corporation   

78.11
8 General Mills  78.03
9 FedEx Corporation 77.79
10 Intel Corporation 77.27
11  Toyota Motor Corporation 77.27
12

 Home Depot

76.50
13

 The Procter & Gamble Company

75.91
14

 The Walt Disney Company

75.88
15

 Dell Computer Corporation

75.73
16

 Honda Motor Co. 

75.60
17

 Pepsico

75.26
18

Costco

74.03
19

IBM Corporation 

73.42
20

General Electric Company

73.39
21 Southwest Airlines 73.20
22 The Boeing Company 73.10
23

Starbucks Corporation

72.93
24 Nike 72.11
25 Target Corporation 71.83
26 E.I. D uPont De Nemours (DuPont)  71.56
27 Apple Computer 70.59
28 Unilever 70.28
29 Wal-Mart Stores 69.99
30 Best Buy Co. 69.74
31 Hewlett-Packard/Compaq 69.44
32 Pfizer 69.10
33 J.C. Penney Company 68.81
34 Verizon Communications 67.01
35

McDonald''s

66.83
36

SBC Communications

66.67
37 Ford Motor Company 66.14
38 General Motors Corporation 66.07
39 Bank of America Corporation 66.00
40 Allstate Corporation 65.82
41 Sears Holdings Corporation (Parent of Kmart/Sears, Roebuck, and Co.) 65.26
42  Gateway 65.17
43  Citigroup Incorporated 65.00
44  DaimlerChrysler 64.47
45  Merck & Co., Inc 64.07
46  Time Warner Inc. 63.85
47

 ChevronTexaco Corporation

62.46
48  AT&T Corporation 62.37
49  Comcast Corporation 62.08
50

 Altria Group 

61.62
51

Sprint Corporation

61.01
52 Martha Stewart Living Omnimedia 60.99
53 ExxonMobil Corporation 59.57

54

Royal Dutch/Shell* 59.45

55

Tyco International, Ltd. 58.39

56

United Airlines/ UAL Corporation* 53.09
57 Halliburton Company 52.22
58 Adelphia Communications Corporation 49.75
59 MCI (formerly Worldcom) 46.80
60

Enron

30.05

 

Dan Keeney
(832) 467-2904
(832) 467-2909
Author: Dan Keeney
Phone: (832) 467-2904
Fax: (832) 467-2909
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