MWW Survey: 3 Out Of 4 Business Leaders Believe Corporate Reputation Is Substantially Driven By Internal Culture
Yet Only 5% Believe Their Organization’s Culture is Strong Enough to Prevent a Situation Similar to Goldman Sach’s Recent Reputation Crisis
NEW YORK – May 31, 2012 – Three out of four business leaders believe corporate reputation is substantially driven by internal corporate culture, yet only 5 percent think their organization’s culture is strong enough to preclude reputational crisis, according to a recent survey of 100 business leaders and HR professionals conducted by MWW Group.
These findings reveal a significant gap between executives’ perceptions of the importance of a healthy cohesive corporate culture and their willingness to prioritize and tend to the factors that cultivate that kind of culture – strong leadership and effective communications. As a result, these executives are putting their organizations at risk of employee discord and dissatisfaction that can lead to long-lasting damage to reputation, as was the case for Goldman Sachs after a letter written by a former employee critical of the firm’s internal culture appeared in the New York Times in March. The consequences can be financial, as well: for example, JP Morgan’s loss of more than $2 billion in a single trade earlier this month, which many inside the firm blamed on a lack of leadership and internal divisions in the chief investment office.
This isn’t the only gap in perception and behavior suggested by the findings. A majority of executives count employees among the top two influencing groups that most impact their reputation (in contrast, only 15 percent said the same about consumer media, 5 percent trade media). Yet, only 74 percent believe employees truly buy in to their corporate culture.
“Nearly every week a major company is in the news with a culture related crisis, and this study demonstrates a growing acknowledgement of the connection between internal culture and external reputation,” said Carreen Winters, executive vice president, reputation management of MWW Group. “Yet all too often, reputation management programs focus exclusively or predominantly on engaging with external stakeholders. Positive, productive cultures don’t just happen; they are cultivated and nurtured over time. Communications can be a powerful and effective tool for connecting the dots between internal and external stakeholders, and for creating the kind of culture that serves as the foundation of a bulletproof reputation.”
The survey also asked business leaders’ reactions to the scathing open resignation letter critical of Goldman Sachs internal culture published in the New York Times. Among the findings:
- 77% believed the letter had a negative impact on Goldman Sachs’ reputation
- Only 3% strongly believed that this was an isolated incident of a single disgruntled employee and not representative of the culture at Goldman Sachs
- 66% expect to see more of these situations with other companies in the future
The full report can be found here.
About Corporate Reputation Management at MWW Group
MWW Group’s Reputation Management practice takes a strategic approach to helping companies manage this most critical asset, taking into account that a strong reputation builds on several intrinsic elements that ladder up to ultimate value. The MWW Group team expertly leads clients through an internal review and audit, collaborates with clients to develop the company position, creates supporting program tools and prepares communication strategy for effective program execution. For MWW Group’s POV on reputation and leadership issues in the news, visit the Return on Reputation blog at www.returnonreputation.com and check out our Corporate Reputation manifesto.
About MWW Group
MWW Group is one of the nation’s top mid-sized public relations firms and one of the ten largest independent global agencies. The company is industry-recognized for its work in consumer lifestyle marketing, digital marketing and social media, corporate communications, public affairs and government relations, consumer technology, healthcare and visual branding.
Through its “Network PR” approach, MWW Group helps its clients re-architect the conversation surrounding their brands to increase trust and relevance and drive action among key stakeholders. Among its numerous awards for client work, the agency has been recognized as 2011 “Midsize Agency of the Year” and 2010 “Strategic PR Agency of the Year” by the Holmes Report and has received accolades from PR News for “Team of the Year,” “Digital Firm of the Year” and “Top Places to Work in PR.”