In Part I of this two-part series, we looked at how reputation intelligence is offering high performing companies better insights, information on key stakeholders and benchmarks to drive performance. Now, Polecat Intelligence discusses further ways that reputation intelligence gives businesses a competitive advantage.
Reputation intelligence provides a growing body of data to help board members meet wider priorities including legal obligations and performance objectives. It also informs board culture and strategy.
The challenge: An important measure of corporate performance is how company boards adopt good governance practices on their company’s behalf. While governance standards differ across geographies, listed companies carry specific responsibilities by law (I) and boards must work hard to ensure that they meet regulatory, risk and compliance needs as a core requirement of their fiduciary responsibilities. Ongoing legislative changes (II) have placed emphasis on disclosures around shareholder activity, with enhanced voting rights on executive remuneration policy, and a push for greater visibility of communication with shareholders.
Importantly, the intent of the law is to encourage shareholder engagement and transparency of directors’ performance based on an assessment of financial and non-financial indicators. These include, where appropriate, criteria relating to corporate social responsibility and ESG factors that benefit companies, society and the economy as a whole (III). Today, board directors and leadership teams represent the public face of a company and are therefore subject to scrutiny over their actions. Those found to act unethically or irresponsibly face public backlash - with company reputation caught in the crossfire.
The solution: High performing companies use the insights that they gain from reputation intelligence to proactively engage and communicate with stakeholders. Thereby managing shareholder activism and building trust with investors, legislators and the public.
Reputation intelligence provides line-of-sight about wide-ranging industry, sector-specific, environmental and social impact issues. It is, therefore, a vital resource for board directors, who must understand the depth and breadth of stakeholder issues, and act upon the business and market drivers needed to ensure the long-term success of their companies.
The challenge: The growth of AI-led technologies has, in turn, fueled the growth of data and analytics products in the market. This poses a challenge for businesses that require robust insights for decision-making. The gap between data and the availability of analytical talent to support its successful implementation and usage (IV) of data is deficient. One way to address this, in an absence of in-house expertise, is to tap into the solutions made available by credible reputation intelligence providers.
The solution: Companies that use reputation intelligence do not compromise on substandard media monitoring products that add little business insight. Instead, they take advantage of solutions that combine the power of analytics with a holistic understanding of reputation management. Tools that embed the human element of expertise as an intrinsic part of its offering. This adds another layer of knowledge to a reputation intelligence tool, with additional guidance, consultancy, analyses and customer service to assist organisations, that is matched with their workflow needs.
Over time, companies that collaborate with reputation intelligence firms can co-create, reputation management strategies and customise tools to their own specific needs.
The challenge: Today, high-performing companies are balancing the interests of a wider group of stakeholders to drive corporate performance. Increasingly, evidence points to a direct link between successful companies and the longer-term value-creation strategies that they employ. Capturing long-term revenue growth, R&D, employee brand value, and even its impact on economic growth (V).
As the benefits of long-term value creation are realised, CEOs and leadership teams can turn to reputation intelligence that drives shareholder value, in the present and future (VI).
The solution: Reputation intelligence provides unique insights and understanding to help forge thinking on business continuity and long-term value-creation. Giving a view on a holistic set of drivers that uncovers _intrinsic value _for a company. Business Compliance, Environment, Culture, Social Impact, Business Continuity, and Innovation are set classifications or taxonomies, that can be used to define and measure the positive and negative reputational impact generated by companies over time. Companies are taking advantage of organised and comprehensive data sets (VII), to examine in detail, the topics and issues that unlock growth and opportunity and see what triggers risk. In doing so, they strengthen their own company position and benefit from the foresight of reputation intelligence.
High performing companies are enabled by reputation intelligence to help increase perceived value of its products and services, and secure customer loyalty as a cornerstone of its business continuity. To compete and thrive in a dynamic business environment however companies need more than tactical approaches to improve market valuation but corporate strategies that will generate sustained growth and earnings potential over time. This has been the welcomed experience of several global businesses that have seen strong links between stock performance, value-creation strategies and reputation gains as a measure of corporate success.
[Merck and Co.’s CEO Kenneth Frazier has been a strong advocate for responsible capitalism, with a view on long term value creation and bottom-line impact. His vision for sustainable long-term growth at the pharma giant has created solid revenue gains for the company – hitting a high as US equities best performer for 2018 (Dow Jones Industrial Average). Merck & Co’s ties to reputation gains are also correlated in analysis here, that sees the highest reputation driver "Innovation" (more than 22,000+ postings) and a high reputation impact score to showcase its advances in R&D cancer-fighting drug therapy, is winning investors over. Similarly, under “Business Compliance”, the pharma company registered significant volume of conversation (12,000+ postings) and a high impact score that showcased a number of strategic sales wins in the last 6 months. CEO Frazier has stated Merck is on course to meet earnings target at financial year end. Source: Polecat Intelligence]
Reputation intelligence offers an unparalleled level of insight and reporting to senior leaders and reputation teams. Polecat provides global reputation intelligence for companies around the world. To discuss this analysis further or to gain additional insight, contact us today.
(I)UK Corporate Governance Code. The new Listing Regime introduced in April 2010, applies to all companies with a Premium Listing of equity shares regardless of whether they are incorporated in the UK or elsewhere. www.icaew.com
(II)Shareholder Rights Directive (SRD II) which will be effective from 1 July 2019 in all EU Member States.
(III)Hermes Investment Report: The Shareholder Rights Directive. https://www.hermes-investment.com/wp-content/uploads/2018/10/hermes-shareholder-rights-directive-an-engaging-opportunity.pdf
(IV)PWC Annual Survey
(V)The real business of business, McKinsey research. https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/the-real-business-of-business)
(VI)Ibid. The weight of such evidence and our experience supports a clear definition of what it means to create shareholder value, which is to create value for the collective of all shareholders, present and future
(VII)Polecat Intelligence’ proprietary platform, is built on a classification system or taxonomies, that organize reputation market definitions and criteria. These taxonomies are built on keywords have been curated over years to provide unparalleled insight into the drivers, topics, issues that drive reputation impact.