Increasing value through reputation management

By Ingo Plöger, President, Strategic Council, CEAL

Reputation is a perception of values that people have for a person, products, companies, sectors, institutions and countries. Value increase or destruction can happen by the perception of the customer or user.

Stereotypes are the first paradigm to overcome to see the right picture.

Certain events will remind you of some countries or people, like bullfighting, Oktoberfest, soccer, rodeo among others. The same happens if you remember global products like Mercedes, Boeing, Hyundai, Apple, McDonald’s, etc.  The great question is how perception can change your evaluation of reputation.

In a very interesting congress about reputation in Rio de Janeiro last September, Prof. Cees van Riel from the Reputation Institute, showed that investments made throughout many years in reputation management has increased the sustainable perception of image and created value. As an example, Canada, Switzerland and Australia have very high confidence in their reputation. Even Spain, considering the difficulties at the moment, has a very good perception in foreigners’ eyes.  

Meanwhile, Latin America doesn’t show a significant change, and the perception is a continent with difficulties, no growth, complicated to do business and very disperse. Nowadays, it’s even worse from the image of corruption, political instability and with no great future.

Companies in Latin America that were involved in corruption affairs, like Odebrecht, Petrobras, and others, loose high value on the stock market.

What went wrong?

Companies, sectors and even countries didn’t realize the high value and importance of effective and long-term Reputation Management. It’s not about correcting or minimizing the problems, nor making an offensive campaign showing the good side, it´s much more than that! Reputation Management starts with the identification of the paradigms that have to be overcome. The countries’ stereotypes or people are a reality, fighting against it is a wrong strategy. Considering it as a part of the reality and, constructing the right proportion of the other positive factors, is the element of supporting the truth and tell the other story. There is always a second story to be told, that could be more interesting and may turn a vision to be more expressive.

Latin America is more a solution rather than a problem for the future agenda. A continent where peace is inherent (although that’s not obvious), where changes are ongoing without disruption of democratic institutions (exceptions we have), sustainability is increasing in the economic, social and environmental areas. Social and political insertion is developing with decrease of poverty, and there are many more integration movements than separatist tendencies. Why is this story telling not effective?

The leadership in Latin America thinks and talks much more about their differences than their common ideas. The criticism from within and outside is very strong. The construction of a common vision is done only by a few leaders. This picture shows how necessary Reputation Management is needed in the countries and in the companies. The undervalued continent in stock values, in risk perceptions, in real value of opportunities, brings to the imagination more uncertainties than certainties.

Reputation Management begins in the mindset, showing with strong visions the future prospective, demonstrating the strengths and the weaknesses in an objective way, and underlining how their values and society react to new events, generating opportunities to build up a new stereotype. And when problems arise, these visions will show how strongly, or not, a society and leaders have to face them.

Reputation Management is much more than compliance, it’s a fact of sharing values objectives and ethics together. A new way for modern and advanced leaders who are engaged with their future generation.

Latin America has much more value to show!

Examples of Reputation Premium for stock quoted companies in Brazil:

The executive summary and presentation of “2017 Brasil Reputation Dividend Report” can be downloaded here: http://www.mzgroup.com/reputation.html