Administration May 6, 2002

Reputations Ruined by Unethical Conduct

June 5, 2002 (PLANSPONSOR.com) - Having witnessed the fallout from the Arthur Andersen accounting scandal, almost half the executives polled in a survey cited unethical behavior as one of the greatest threats to a company's reputation.
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And watching the scandal unfold in the media caused 49% of the sample to cite negative press as constituting a real threat.

According to the annual Corporate Reputation Watch survey by Chief Executive magazine and PR firm Hill and Knowlton,

  • a further 36% believe that disasters pose the most danger to corporate reputation,
  • some 35% point to litigation, and
  • only 13% of the sample say that criticism on the Internet poses the biggest threat

Influences

This year’s survey found that

  • 93% of the nation’s senior executives believe that the opinion of customers strongly influences corporate reputation,
  • followed by employees, cited by 80%, and 
  • CEO reputation, also 80%

The majority of the companies included in the survey measure their corporate reputation either formally or informally.  To do so,

  • 73% listen to the word on the street,
  •  41% conduct custom research,
  • 40% believe that financial performance has the most impact on corporate reputation,
  • 32% pay attention to media coverage, and
  • 27% take note of published rankings.

The survey, which was conducted by Harris Interactive in February, comprised the input of 557 executives.

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