The Importance Of Reputation

Reputation refers to desirable or undesirable qualities associated with an organization or its actors that may influence the organization’s relationships with its stakeholders. I discovered that several factors that affects the firms’ reputation are social conscience, emotional appeal, vision and leadership, and workplace environment. The firms’ actions will influence the different groups of stakeholders in society. At the same time, these stakeholders which include the customers, suppliers, employees, and local communities all can affect the firm’s decisions. My observation is that stakeholders are usually worried about an issue significant to them. Some of the issues include child labour, animal cruelty and environmental harm. These stake

A firm’s reputation is a precious intangible asset and it helps the firm become more competitive by motivating recurring purchases by faithful customers which increases profits. This is supported by a study I found conducted by Reputation Institute where the 60% of the people were more willing to buy, work for, and invest in a company if their impression of the firm was good. I believe that a firm which provides a social benefit to the community, or is more responsive to the needs and worries of its customers, or takes heed of its employees’ needs would appeal to and hold onto better employees to stimulate productivity. This is supported by Turban and Greening (1997) which reported that firms with a superior reputation of corporate social performance were assessed to be more appealing as prospective employers by job applicants. Thus, a company will become more competitive from having a good reputation by improving the quality of people it attracts as employees. The public were

For example, Microsoft has the best CSR reputation because Bill Gates opened the Bill and Melinda Foundation. The foundation has contributed $43.5 billion since its opening to improve healthcare and alleviate extreme poverty. However, managers must not only execute measures, but constantly re-evaluate their measures to be compatible with recent ethical practices so that the measures are not out-dated. I also think that addressing the community’s needs in a positive way also helps to enhance the firm’s reputation. This is in accordance with the iron law of responsibility, where it is in a firm’s self-interest in the long run to use power in a manner that society considers responsible. Firms do this by promoting fair labour standards and environmental responsibility. Many firms realize that providing respect and equality for their workers is a successful strategy for enhancing their reputations. One example I discovered was Nike workers being paid paltry wages and inferior working conditions. In an effort to retain its reputation, the company started stringent monitoring and conformed to the U.S. OSHA clean air standards in its factories in order to improve the situation. It worked and Nike was lauded as one of the few firms that succeeded in rebounding from a reputational disaster. Firms that establish a reputation