Reputation Reputation Reputation
Weber Shandwick initiated an analysis of the “stumble rate” earlier this year. I found it very useful to discussing why reputation recovery is so important today. The stumble rate refers to the percentage of companies that have lost their number one industry status in a five year period. Needless to say, the numbers were staggering – nearly 70% have stumbled — when you think about the world’s and America’s long time corporate royalty . So here I am on September 17th wondering if the term “stumble rate” is too kind a term. It feels as if our financial corporate royalty is falling off a cliff – Lehman Brothers, Bear Stearns, AIG, Merrill Lynch, Fannie Mae, Freddie Mac. Perhaps I should rename the trend I identified. How does the “plunge rate” sound or the “collapse rate” or the “cardiac arrest rate.” The latter term is how it feels to many. The question of the day is not how it all began but how it is going to end.
Reputation matters most of the time. However in dire times like this, all the corporate responsibility and best place to work accolades and top notch bench strength pronouncements begin to pale. Although leadership at the top always counts, where are all those board members that were entrusted with shareholder rights and employee savings. Although I almost never lose faith in what leaders can do to build great companies, I do wonder whether boards need greater scrutiny and even certification.
The financial sector has changed immeasurably over the past several weeks. It will need an infusion of cash to stay alive but also wisdom and guidance to rebuild its once fine reputation. I have a lot of thinking to do on this subject.