Today’s Modern Corporation:
- Fewer than 3 in 10 Americans (27%) feel that most large U.S. Corporations are trustworth, according to a recent Roper survey.
- Gallup poll reveals that business leaders and stockbrokers have joined used-car dealers in the category of “least trusted” individuals in American Society
- Gallup polls also indicate that 82% of the public believe that the top executives of large corporations receive outrageous salaries in the millions of dollars and, at the same time, improperly use corporate funds to adopt lavish lifestyles
- Bernard Madoff’s pyramid scheme, which ruined powerful investors in his funds as well as many worth charities that invested heavily with him
- Corporate public relations practitioners face a delicate balance between arguing for realism and making lame excuses on behalf of their companies.
- Huge enterprises that make and do things will also make huge mistakes, spills worker injuries and evils of fraud and price abuse
The Role of PR
* Made it imperative that companies make a special effort to regain public credibility and trust * Corporate Social Responsibility (CSR) is now high on the priority list of executives and their PR staffs, who are charged with improving the reputation and citizenship of their employers * James Murphy, Global managing director of communications for Accenture * American Businesses and their leaders need to act in three main areas * Adopt ethical principles * Pursue transparency and disclosure * Make trust a fundamental precept of corporate governance * The importance of the PR in CSR is explained by Jack Bergen, Senior vice president of marketing and communications for Siemens Corporation * Jack B said “We are the eyes and ears of an organization”… * A number of strategies and tactics can be used to implement CSR, which involves corporate performance as well as effective communication * One of the more important roles of the PR relations executive is counseling the CEO * The PR executive serves as a link between the chief executive and the realities of public opinion in the marketplace and the organization, according to Mark Schumann, global communication practice leader with Tower Perrin. * Schumann says everyone sucks up and lies to them * Corporations seek a better reputation for a variety of reasons * Responsible business practices ward off increased government regulations * Matter of employee morale, companies with good policies and a good reputation tend to have less employee turnover * 82% believe that good corporate citizenship contributes to meeting the organizations financial objectives * 53% say corporate citizenship is important to their customers * Factors in Corporate Reputation * Transparent and Honest 80% * Company I can trust 80% * High Quality Products or Services * Communicates Frequently * Treats Employees well * Good Corporate Citizen * Prices Fairly * Innovator * Top Leadership * Financial Returns * Being a good corporate citizen is an admirable goal, but corporations also face a number of pressures and counter pressures when making decisions and forming policies * General Electric, one of the worlds largest corporations, with a market value of about 340 billionm once outlined four key factors that have to be considered at all times when making a decision * Political – How do government regulations and other pressures affect the decision * Technological – Do we have the engineering knowledge to accomplish the goal * Social- what is our responsibility to society * Economic – Will we make a profit
* Major financial scandals and other negative coverage can cause a corporations reputation to plummet * Volatility leads corporate executives to be defensive about how