The New Threshold of Public Accountability
Managing reputation and public expectations of transparency is a tremendous challenge for corporations today. However, by demonstrating a commitment to human rights, corporations can gain a loyal customer base looking to consume from companies they can feel good about.
August 20, 2015
For companies of all sizes, it has never been more important—or more challenging—to manage your reputation.
Trust in institutions of all kinds, including business and industry, is at an all-time low. Yet, expectations of transparency, dialogue, and access have never been higher.
Changes in the way people consume news and form their opinions have created an environment that even the most sophisticated organizations are struggling to navigate.
Individual opinions about events rocket around social media, talk radio and cable news so fast that public opinion, usually a harsh public judgement, forms before many companies even know they are in a crisis. And when your reputation is impacted, your sales, earnings, profits, and memberships are instantaneously impacted as well.
Perhaps of even more consequence, is that increasingly, people want to do business with companies they can feel good about. They want to work for, buy products from, and generally associate themselves with companies and entire industries that they judge to share their values. Fifteen years ago when Google announced to the world that its motto was, “Don’t be evil”, it validated to consumers that they could hold businesses to a higher standard.
This has far reaching implications for businesses. The negative associations that turn customers away might be a personal experience they have with the brand, or something they see in the news or in social media about how the company treats its people, its community or the environment.
Or, the types of companies they work with. Yes, businesses are now held responsible for the actions of their suppliers and partners. That’s the new threshold, and the public has access to enough information that evaluating companies based on their business practices is fair game.
Information about trafficking in persons and other labor and human rights violations is a vitally important part of what many consumers want to know about the businesses they consider supporting. New reporting requirements are making it easier for the public to be selective around this topic.
As always, opportunity is the flip side of risk. Companies who value those consumers can, and should, be promoting their positive record and commitment to being the kind of company that people can feel good about.
If they do, and demonstrate the transparency and responsiveness that people are demanding, they’ll find a loyal market waiting for them.
Sean Smith is the Executive Vice President at Porter Novelli, a company that motivates people to change deeply ingrained behaviors rooted in cultural and social norms. www.porternovelli.com
This piece appears as part of KnowTheChain’s blog series on a growing trend towards supply chain transparency. Follow the discussion at: http://bit.ly/1HpEEOu