ECONOMY

Reputation-building going up

It’s been said a thousand times. A good name may take many years to build and merely a few hours to destroy. But in Greece, this period is even shorter due to the excessive interest of a section of the media, which often passes judgment, condemns and denounces without due cause. Reputation is one of the intangible assets of a firm. But until recently, reputation management, like crisis management, was unknown to most Greek firms. The two are intertwined, as the lack of foresight and adequate preparedness in face of a crisis can destroy a firm’s reputation. The creation of Tradelink Reputation Management (TRM), set up about a year ago, is an innovative enterprise for Greece. Allied to the Reputation Institute of New York, and with partnerships in most European countries, its object is to build up a good reputation, credibility and prestige for firms that will provide competitive advantages and capital gains, turning stakeholder groups into goodwill ambassadors for the enterprise and its products. «In the eyes of all stakeholder groups, a firm is automatically considered guilty until proved innocent,» TRM’s Managing Director Petros Constantinidis told Kathimerini. «The response of Greek firms has been better than expected. Nine out of 10 firms we have contacted have entered deals with us. Their chief executive officers (CEOs) who adopt the principles of Reputation Management become chief reputation officers (CROs). They tell us that they knew of no such thing in Greece and are pleased because what we present to them matches with what they imagined or recognized that they must do. The managing director acquires an instrument, a mechanism for managing intangible capital. We go deep into the enterprise and hold dialogues with all stakeholder groups in order to arrive at a winning scenario,» said Constantinidis. TRM believes that for a firm to have a good reputation and prestige, the management model must encompass all the groups that constitute its environment. The firms that respond are usually those whose product has the same name as the firm. «These are those most eager to show they are not just a brand but a lot more besides,» said Constantinidis. «They feel the need to display their corporate responsibility, knowing that a brand can no longer stand on its own. But we have also had a strong response from the big listed corporations that do not produce consumer products.» A research tool of TRM, which works as an inventory of the intangible assets of a firm, is the «reputation balance sheet,» established by the Reputation Institute of New York on the basis of internationally established standards and tested methods. In Greece, it was drawn up after a series of qualitative studies with focus groups. «We spent an entire year on our version and consider that this our own investment; for although we are not a research company, we are the only one that has a tool for researching intangible capital. If you do not know the landscape today, which companies need help, you cannot be useful. Besides, our ultimate purpose is to be business consultants in order to manage their future and guide them toward client-centered schemes. We use the research consultatively. But it’s like medicine; it needs a doctor to prescribe it,» said Constantinidis. Firms abroad using reputation management services enjoy premium discounts from insurance companies. A crisis that can damage a firm’s reputation may be due to a variety of causes, such as a mistaken decision, human error or negligence, but may also be due to outside causes. In order to build the reputation of a firm, particular emphasis is placed on uniting all stakeholders through a vision of the enterprise. An important stakeholder is the firm’s work force when it feels committed to the company and takes pride in it. Otherwise, it can prove a major liability. Currently, TRM is in the last phase of a public opinion research project. According to initial results, the top 20 firms and managing directors were rated as having a good reputation by 97 percent of respondents. Seven percent of respondents rated them as poor. The remaining firms were rated by 97 percent of respondents as having a bad reputation, with only 3 percent getting a good rating. «The conclusion is that you must prove that you have a good reputation,» says Constantinidis. «The project showed that a relatively high percentage of people adopt a guarded attitude towards firms. Greek companies are given considerably different ratings by consumers, foreign investors and stakeholder groups.» At present, all exports go through Russia via the Atyrau-Samara pipeline, which pumps up to 15 million tons of crude a year into Russia’s state pipeline monopoly Transneft system, or through the newly built Caspian Pipeline Consortium (CPC) link. CPC, operated by a Western consortium, runs from the giant Kazakh Tengiz field, operated by ChevronTexaco, to the Russian port of Novorossiisk and has a capacity of 28 million tons, which could be gradually raised to 67 million tons.