Posts tagged reputation

The European Commission is investigating the relationship between CSR and competitiveness

December 8, 2008 · Filed under news · Tagged , , , ,

I have presented in a previous post the recent initiatives co-financed by the European Commission aimed at investigating the relationship between CSR and competitiveness. On November, 28, the European Commission has published a Communication on the European Competitiveness Report 2008.

The European Commission analyses in chapter 4.2. the impact of Corporate Social Responsibility on firms’ competitiveness. This issue is developed in the “Commission Working Staff Document” which accompanies the European Commission’s Communication.

The European Commission has analysed the effects of CSR on 6 determinants and indicators of firm-level competitiveness: cost structure, human resource performance, customer perspective, innovation, risk and reputation management and financial performance. Moreover, the European Commission has analysed the relationship between CSR and firms’competitiveness at macro and sectoral level.

Some of the  main findings of the research undertaken are summarised below.

1.The strongest evidence of a positive impact of CSR on competitiveness at micro level appears to be in the cases of human resources, risk and reputation management and innovation.

2. Business interest in CSR is increasingly based on opportunities for new value creation and not just on value protection through risk and reputation management.
3.The strength of the business case of CSR in any given enterprise is still dependent on its competitive positioning. For some companies, exceeding social and environmental legal requirements might generate costs that undermine competitiveness. However, for an increasing number of enterprises in a growing number of industries, CSR is becoming a competitive necessity.

4. To be a competitive differentiator, CSR needs to be part of a core business strategy. Enterprises in which CSR remains a peripheral concern, mainly confined to public relations functions, are likely to miss opportunities for competitiveness gains.

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Reputation matters:))

November 14, 2008 · Filed under research · Tagged , , , ,

The Reputation Institute has been measuring corporate reputations since 1999.

Corporate reputations are valuable assets because they influence the profitability of companies. Consumers, creditors or job-seekers decide whether to enter into a relationship with a company on the basis of its reputation among other factors.

In 2006, Reputation Institute has introduced RepTrak Model, a scorecard for measuring corporate reputations internationally. At the heart of this model is Pulse which measures the degree to which people trust, respect, admire and have a good feeling about a company. Scores are based on answers to four questions and are standardized on a scale of 0-100.

The Reputation Institute further examines if the Pulse score is based on perceptions of companies on seven underlying dimensions identified in the RepTrak Model: Products/Services, Innovation, WorkPlace, Citizenship, Governance, Leadership, Performance. It is important for companies to understand what is important for their stakeholders and to act accordingly.

In 2008, The Reputation Institute published the a special report for the Boston College for Corporate Citizenship in which it has included the list  of the most respected U.S. Companies by the public.

Google earned the highest rating of perceptions along social dimensions (Citizenship, Governance and Workplace). Basically, with the exception of Berkshire Hathaway, consumer oriented companies made up the majority of top 20 SRI performers.

The main conclusion is that companies who have invested in a strong Social Responsibility profile get a much higher level of support than other companies.

65,7% of the US general public would recommend the Top 20 socially responsible companies to others compared to only 25,9%  recommendations for the bottom 20 companies. And more than 27% would not recommend the companies that are not seen as social responsible.

The conclusion of the report is that social responsibility is a direct way to business success.

But “having a strong social responsibility profile “= “being socially responsible”?


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