Reputation management: the new face of corporate public relations?

Abstract

An empirical study of Fortune 500 companies suggests that “reputation management” is gaining ground as a driving philosophy behind corporate public relations. Whether the phenomenon is a trend or a fad is not clear, given the lack of consensus in defining reputation, the instability and questionable validity of reputation measures, and unanswered questions about when and how (or even whether) reputation can be “managed.” Besides reputation management, corporate public relations departments in the study embraced a wide variety of other definitions of their function, suggesting that public relations continues to have great difficulty in defining itself. While the study did not find a strong correlation between reputation and overall spending on corporate communication activities, as had a similar study the prior year, it did find some interesting correlations between reputation and specific categories of spending.

Introduction

In just the past few years, a growing body of academic and practitioner literature has emerged concerning “reputation management” [1]. On the academic side, a new journal, Corporate Reputation Review, was launched in 1997, and several dozen articles on the topic have been published in other communication and business journals. On the practitioner side, a public relations trade publication entitled Reputation Management was launched several years ago, while Shandwick [2] and some other major international public relations agencies have embraced the concept of reputation management in varying degrees.

Noticeably absent from the discussion has been any significant body of research concerning what corporations are actually doing in the way of adopting reputation management as a guiding philosophy. Many of the academic studies that have focused on corporations’ reputation management activities have tended to simply assume that organizations are moving toward a reputation management perspective, redefining traditional public relations and communications activities as reputation management. Davies and Miles [3], for example, found little or no “reputation management” terminology in job titles or departments, and very little connection between reputation management theory and the reality of organizations. They simply assumed that reputation management existed and was a growing function within the organizations studied, despite the fact that only a small minority of respondents described their function as reputation management.

The current study provides a brief background and context to the issue of reputation management, sheds some light on current corporate philosophies concerning reputation management through an empirical study, and raises a number of questions about reputation management from both descriptive and prescriptive perspectives. Specific questions addressed by the study include: Is there a correlation between corporate reputation and spending on corporate communication activities? How stable is Fortune’s reputation measure? What proportion of large companies are using “reputation management” as a/the guiding principle behind their corporate communication activities? Is there a correlation between an organization’s reputation and the role of corporate communication within the organization?