Why Is A Firm 's Corporate Reputation Important?

Crisis Marketing. (n.d.). Crisis marketing and Reputation. Retrieved April 15, 2014, from Reputation Management For: http://www.reputationmanagementfor.com/crisis-marketing/crisis-marketing-a-reputation.html

From the point of view of the external environment, the effectiveness of organization would gain much more support when the company do the business with their consumers and suppliers, due to the company has provided a wonderful environment for the employees (Businessweek, 2007). Obviously, when the company’s reputations has been known and improved because

|Companies reputation may help to achieve a competitive advantage in |Changing interests in online products and services |

A person’s reputation is the beliefs and opinions that are generally held about them by other people. Abraham Lincoln stated “Character is like a tree and reputation like a shadow. The shadow is what we think of it; the tree is the real thing.” This quote shows that the reputation of a person is only a small part of a person. What really matters in a person is their character. Someone can have a bad reputation and still have great character. If someone can get past what others think about them then a good reputation is not overly important.

Reputation is very important when it comes to a company, a certain group, or even an individual. It is important because it is what people will judge one off of which leads to whether or not people want to associate themselves in anyway with one’s reputation because it can look bad to others on their part. This can be avoided for the most part by using ethics, social responsibility and sustainability to better his, hers, or its actions in everyday situations. When these basic obligations are ignored, tragedy can ensue on a small or large scale. In this case, the Buffalo Creek Disaster was large scale, impacted many people, and was an example of the greed companies have. Pittston, the sole shareholder of the Buffalo Mining Company allowed the corporate veil to be pierced that in turn brought Pittston to the same level as the people who were impacted by the breaking of the dams. Corporations such as Pittston try to intimidate and use excuses at to why certain problems occur, not wanting to take responsibility for their actions; it

* Image of the company; Organisation with a positive image and diverse workforce will have more chances of attracting, recruiting and retaining the talent. Negative image leads to loss of trust from employees current and potential, as well as all business partners or customers.

In the epic poem Beowulf reputation shows a big part in how you are seen, and perceived. King Hrothgar knows of his cousin Beowulf due to his brute strength and courage from stories. When Beowulf- said to be the strongest of the Geats, the strongest man in the world (pg. 23, lines 110-111) - arrived in the story with his fourteen men who were said to be the strongest and bravest of the Geats (pg. 23, lines 120-121). Unferth the son of Ecglaf has heard of stories from when Beowulf had a swimming race with his cousin Brecca. The only thing Unferth really knew about Beowulf was that he lost the race to Brecca, and how they were boastful fools who only cared about the danger of it.

Chipotle is in the fast food segment, where setting up a food joint is easy. And acquiring suppliers and buyers is also relatively easy. But industries like these essentially work on customer trust and support. It is a rare case of how one small event can tarnish a company’s reputation overnight. It was probably something out of a nightmare for Chipotle’s employees when E. Coli was discovered in their food ingredients and discouraged customers to visit Chipotle stores. This also hit their stocks, and they never quite recovered from the downfall. Chipotle’s motto of serving food with dignity is something they have always stood by and adhered to. Thus, they wouldn’t have compromised on anything. (1) After initial trouble, which started in the summer of 2015, things have now relatively calmed down and Chipotle is doing marketing at an unprecedented level. Industries which are hit by health problems, rarely recover this fast. Its stocks and market reputation is bound to go down.

Brigham and Lesson (2010) stated, “over the last three decades, the percentage of a company’s value attributable to tangible assets has dropped from 90% to just 25%.” However, intangible assets, reputation included, make up 40-60% of a business’s capitalization. An industry like Big Pharma relies heavily on its reputation. An organizations actions, choices, behaviors, and consequences will influence a stakeholder’s perception. This is a roundabout way for an organization to help determine its own reputation. Word of mouth, past experiences and media coverage will always influence reputation of corporations. In his article in Nature Biotechnology, Mark Kessel (2014) explains, “For companies in the pharmaceutical sector, how stakeholders view companies is influenced primarily by the lay professional media (through print, TV, radio and online) and the internet (blogs and social

Till today, the threat of lawsuits remains. These scandals give a bad image to the company

1.What role does corporate reputation play within organizational performance and social responsibility? Develop a list of factors or characteristics that different stakeholders may use in assessing corporate reputation. Are these factors consistent across stakeholders? Why or why not?

In this case of Enron the corporate culture played a vital role of its collapse. It was culture of full of moneymaking strategies and greed, in the firm Greed was good and money was God. There was no or very little regards for ethics or the law, they operated as there was no law and ethics in the world (Enron Ethics, 2010). Such culture affected all the employees of the firm from top to down. Organizational culture supported unethical behaviour and practises, corruption, cheating and those were all widespread. Many executives and managers knew that the firm is following illegal and unethical practises, but the executives and the board of directors did not knew how to change this unethical culture, the firm used creative accounting and were making showing misleading profits every day. Reputation management enabled them carry on their illegal and unethical operations. Moreover if the company made huge Revenue in the unethical way then the new individual who joined the firm would also have to practise all those unethical practises to survive in the company. All of the management was filled by greed and ambition, their decisions became seriously imperfect, thus the firm fell back and managers had to pay in the price in the form imprisonment and fines. Greed is the main key factors that brought the Enron “the most innovative company” to downfall. Enron was looking into the ways of

Google’s greatest vulnerability in the ordeal with China was damage done to its reputation because we should, as stated in the Bible, “Earn a reputation for living well in God’s eyes and the eyes of the people.”(Proverbs 3:4) When running a company it is highly important to preserve good standing because

Business Industry has witnessed the outcomes of bad moral decisions taken by business leaders. Enron’s story is only one example of corporate scandals and cases of bad moral decisions, which has not only shaken the public trust in corporations, but also affected the bank accounts of investors and employees. Before the bankruptcy of Enron; it was included in one of the fortune 500 companies after its fraudulent accounting case the share went down to $1 (Enron scandal, 2010; PBS, 2002; Godwin, 2006; Godwin, 2008).

A multitude of choices made by executives at WorldCom led to the ultimate demise of the company as it was previously known, the employees and their livelihoods’, and the trust of the American people. In a time when corporations fail to set ethical standards and provide transparency to investors, how do we change corporate culture on a national level? By analyzing choices made to improve stock prices and company image that ultimately result in failure-- we can guide