Brand reputation is something that we all understand as consumers, facing the decisions made by large household names – and their consequences – on a daily basis. Recent reputational crises are relating more commonly to issues regarding sustainability, as businesses and even influencer brands come under fire for wasteful and ecologically damaging practices.
But for many business owners, there is a disconnect between the reputations they subliminally judge as consumers, and the reputations for which they are responsible as leaders. Here, we will discuss the sheer importance of a business’ reputation – and the ways in which management failure can harm a business irreparably.
Reputation is an asset
A fundamental way of viewing your business’ reputation is to treat it like a tangible asset – with presence, weight and, above all, value. Indeed, reputation is an asset, and, in many cases, the single most valuable asset a business can own.
A business’ reputation can be built in a number of key ways, and the most easily-understood of these ways relates to the customer experience. If you provide a high-quality, reliable service to your clients you will build a positive reputation and grow your customer base organically.
Poor customer service and poor-quality results will, naturally, directly impact a business’ profitability and long-term viability – but these are short-term issues easily and necessarily solved, by virtue of their direct relation to your service. There are other mechanisms by which reputation is built and maintained, which can be much more difficult to manage.
Corporate responsibility is a neat term that describes the various ways in which a business must take responsibility for the various impacts it may have – socially, environmentally and economically. These impacts are often systemic in nature, and can have a profound impact on the reputation of a business if not managed properly.
Business failures to maintain a safe working environment will inspire staff action, and attract negative press; unsustainable and wasteful processes stand against the flow of global sustainability efforts. Failure to properly address equality, diversity and inclusivity within your workforce and network will also constitute major crises when it comes to social reputation.
It can be difficult to understand the best course of action for a business, reputationally speaking – especially where the damage may have already been done. The best approach is an honest one, made in good faith. Brands do not often rehabilitate themselves through reactive change, which is largely perceived as a damage control measure as opposed to a genuine attempt at reform.
Proactive change, however, sends the right message – that your business is committed to doing the right thing. Committing to ESG strategies and publicly announcing roadmaps to equitable measures will increase trust and confidence, both internally and externally. This can help you preserve your reputation for years to come.