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Moral authority and reputations

The world of corporate and national reputation is going through a whirlwind right now, even more so than usual. Two particular issues have rather preoccupied my mind recently.

One is the relationship between business and government and the other, going back to basics on the relationship between reputation and moral authority. 

Bell Pottinger has always been associated with the dark arts of public relations. Most of the industry, for decades now, have at least tried to be morally accountable in the way it communicates its clients' narrative and indeed, in selecting clients with whom it is prepared to work. Bell Pottinger appeared not to have ever been perturbed about representing clients who are morally questionable at best, and downright unacceptable at worst. It managed to weather several storms of exposure and criticism and on the way, continued to gather more and more questionable clients. Until that is, its recent South Africa debacle, made worse by a public spat between founder and CEO, and what appears to be an inability to address a crisis. It's collapse, though slow in coming, was therefore inevitable. It followed an exodus of corporate clients who were no longer prepared to be associated with a company with a tainted brand and a questionable reputation.

We have heard the mantra of the value of reputation to the bottom line over and over again for more than twenty years. The question now is how valuable is this reputation, really? Reputation Dividend actually puts figures on this value, and this year places this value, in the UK, at a stonking 39% of shareholder value. That's a big number, and should make us all sit up and pay attention. 

Meanwhile, corporate America is strengthening its voice in a nation with a leadership which is increasingly losing its moral authority. It is rethinking its relationship with the political leadership in a world where businesses have traditionally sought close collaboration with government as a way to build credibility, legitimacy and a licence to operate. As Mark Benioff of Salesforce says: "... some executives have concluded that speaking out on issues of morality can improve more than their reputations — it can benefit recruitment, morale and even sales. Our employees come here knowing that this is something that is extremely important to us. Business is the greatest platform for affecting change.” It didn't take long for business leaders to start distancing themselves from the Trump administration, realising that their moral authority, which provides them with that all-crucial brand reputation, is threatened by their close proximity with the White House. 

A year ago Steve Olenski wrote in Forbes that "We need to think about our reputations as a constant, competitive advantage; a driver of growth and prosperity; and a strategic asset. We need to think about reputation marketing". I couldn't agree more. When corporations and corporate leaders find a stronger moral voice, it is not purely to express their belief in doing what is socially and culturally right, it is also because business success depends on demonstrating moral authority to stakeholders and consumers. 

Back in the UK, I was interested in reading the results of a BritainThinks and Observer focus group study on how voters see leadership. It seems that 'integrity', 'authenticity' and 'empathy' have overtaken 'communications skills'. Given corporate America's rejection of the Trump presidency social and cultural values, it appears that our two countries are not so far apart after all.


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