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What is the Value of Reputation? The Reputation Institute Launches Reputation Tracker Across Four Continents

Pic from www.trendkite.com
Pic from http://www.trendkite.com

No matter what your position is in a company you should probably be concerned about that company’s reputation. A company’s reputation may not have an absolute numerical value and is likely to vary based on perspective. However, acknowledging its importance is critical to sustainable business growth and individual career progression.

One global organisation that appears to have taken a leading role in deepening the understanding of the measurement of reputation is the Reputation Institute. The Reputation Institute has developed a normative database that provides companies with greater insight into the emotional connections with stakeholders. On September 1, 2015 the institute launched a Reputation Tracker Service in the United Kingdom, Denmark, France, Germany and Mexico to enable companies to be able to synthesize relevant data to create meaningful measures of their reputational risks, opportunities and strengths. More recently the service has been launched in India, Canada, Brazil, Sweden, China, Japan and Portugal. The Reputation Tracker was previously launched in the United States.

Pic from www.reputationinstitute.com
Pic from http://www.reputationinstitute.com

According to the company’s press release “Reputation Tracker is the largest continuous reputation measurement service. Clients receive in-depth quarterly reports, Key Performance Indicators and benchmarks, along with quarterly results workshops addressing Brand Alignment, the Return on Reputation, CSR Alignment and Reputation Risk. Included in the service is the ability to benchmark against the five most reputable domestic companies, as well as three competitors, with additional companies available for a nominal fee.”

I expect that this will be a very valuable tool for companies who are struggling to keep up with the impact of social media, new technologies and changing market dynamics on their product and service delivery mechanisms and the data collected and synthesized in the process give further insight into considerations of ethics and other factors important to a company’s reputation.

Information based on Reputation Institute press release dated October 8, 2015

Should Artists Care What’s Behind the CSR Curtain?

In an ideal world the development of dance, art and music should not have to be so intricately tied to Corporate Social Responsibility (CSR) – nor should it be tied to the public purse either. Increased CSR has121105 - stage_curtains[1] undoubtedly allowed dance companies to grace more stages, kept art exhibitions open for longer, and facilitated free admission to creative festivals.  When the curtain goes up, the show dubbed ‘corporations are great for society’ may be considered spectacular. Often all the audience sees is what has been carefully constructed in the form of entertainment.

Picture from juanvillamayor.files.wordpress.com

Picture from juanvillamayor.files.wordpress.com

Given that smoking kills, and we know the ills uncovered within the industry, is it ok for large tobacco companies to be major funders, directly or indirectly, and therefore have pride of place in the global cultural fabric?

Just to be clear, I believe that corporations should be concerned with CSR. However, I am concerned that companies that have unethical practices compensate by investing in the ‘Arts’ without addressing underlying issues. Their practices include poor corporate governance and failure to adhere to ethical standards. Artists increasingly rely on corporations for their ventures in light of the movement away from public funding of the arts.

I will never judge artists who find creative ways of funding their initiatives, given that without a true appreciation of the value of art to the growth of society, the industry struggles to command ticket prices commensurate with service delivery. On one hand the elite can afford to pay, and artists can target their products and services to extract value. On the other hand, if by chance you are an artist going for mass appeal, there will be limitations on the potential income to be earned – especially in the initial stages.

This trade-of is certainly not an optimal situation and I would prefer to have a robust economy where people get paid enough to have the disposable income necessary to indulge and appreciate the arts, compensating the artists for the true value of their art. Is this not the true aim of sustainability?

Vienna's Opera House Backstage, Austria
The knowledge of what takes place behind the scenes is critical to appreciating what is onstage…           Picture of Backstage Vienna Opera, Austria

There are two conclusions that I draw from my cursory observations of what is happening in this area, and that is, more value should be placed on the works of artists who create; and, as a people we must recognize that the model of CSR as practiced, might not be achieving the ideal of sustainability, although it benefits one group or another. The knowledge of what takes place behind the scenes is critical to appreciating what is onstage, and is central to CSR being more than a smoke screen for the fundamental problems in core business practices.

When a dream car really is only a dream: VW creates a costly illusion

Audi is one of the premium VW brands affected by the revelation that VW has been cheating the emissions system for the last few years. VW will potentially lose over 35 billion dollars (Forbes.com) in the latest scandal. An on-going conversation about the responsibility of companies and their governance structures is back on the front pages.

Dream Audi

The news reports have a similar conclusion – that there will be major losses as, beyond any fines and liabilities, the impact of a loss of confidence in a brand by its customers will be enormous as trust is critical in why consumers buy products such as cars.

What is very interesting to me is that there is a very complex situation here, which is linked to the fundamental governance structure of the company. The issue of who is really responsible is not as straightforward as blaming the current CEO. Where was the board? Who are the investors? Were they taking responsibility for how the company was making its decisions?

The VW Group is registered in Germany. The German governance business structure, which in the past has been praised for its ingenuity, seems to have failed this time. The split board structure sees a separate supervisory board and management board.

Many investors have chosen to invest in the VW brand without truly knowing what the operations are of the company. Of course, as investors how can you really get on the inside? Would there be any way to really tell that you are being cheated? Now that this scandal has emerged, is there or should there be any recourse for the losses that investors will undoubtedly face?

When people ask me why I care and why profit-making companies should factor CSR into their business strategy I respond by saying that in this world CSR is at the very essence of business practices. The direction a company choses to take can hugely positively and negatively affect long-run business fundamentals as well as impact the world around us.

Had the board, CEO and investors more actively encouraged VW to think longer term and take the route of working towards making a truly more efficient product through innovation then for starters perhaps they wouldn’t be facing this complete meltdown. Moreover, they would be truly seen as world leaders in the field without having to worry about covering their tracks every step of the way.

5 minutes with young social entrepreneurs Ben Dowling and Hayden Taylor

One of the most rewarding experiences of my last year in Portsmouth was working with a team of big-hearted, ambitious folks at Unloc, a social enterprise focused on empowering young people through training, student voice and enterprise.

Hayden
Co-founder and MD, Hayden Taylor

The team is ably led by two remarkable young persons Ben Dowling and Hayden Taylor. Before saying goodbye to Portsmouth, I wanted to share with the world some thoughts from these young social entrepreneurs. Over a very informal dinner and in between talking about politics and the nuances of making pasta they graciously agreed, to answer a few questions in their roles as leaders of Unloc.

Q & A

Stef: What are the main positives and negatives of youth led social entrepreneurship?

Ben
Co-founder Ben Dowling

Ben: There are no negatives. Younger people are energetic, innovative, and willing to take risks — risk taking is an important factor in starting new business – something we are born with and as we age we lose some aspects of that risk taking capacity.

Stef: What have been the biggest challenges faced as a young social entrepreneurs in Portsmouth?

Age is no Barrier

Ben: Some people see age as a barrier and so you have to keep proving your worth. It becomes important to not play on your age too much and to prove that you are as good or if not better than the compettition irrespective.

Hayden: Finding people willing to invest in Unloc’s cause has been somewhat of a challenge especially in terms of time, mentoring and money. Capital Investment  is probably the biggest challenge – it’s mostly about the money.

Ben: Portsmouth is a low wage and low spending economy and these factors affect potential to make money.

Stef: Do you think that corporate governance issues play an important role in start-ups for social entrepreneurs?

Hayden: I think corporate governance isn’t considered a big deal for start ups. This is because many young entrepreneurs are purely focused on getting the business up and running. For Unloc’s business model our ethos is centered around generating value added through education and training for the good of society.

Social Entrepreneurs Merge Business and Ethics

By: Stefanie Thomas

Vain Capital… But Know That I Call The shots

Mitt bain Shea Moisture logo

Will the party who controls the money always call the shots? Earlier this week Wall Street Journal released a statement to say that “Private-equity firm Bain Capital LLC is taking a minority stake in Sundial Brands LLC” and immediately Rihanna’s controversial single B*h Better Have My Money (BBHMM) seemed oddly relevant.

Rihanna’s controversial single B*h Better Have My Money (BBHMM) seemed oddly relevant
Rihanna’s controversial single B*h Better Have My Money (BBHMM) seemed oddly relevant

The song is a brash, unapologetic, insensitive questioning of the ownership of black resources. I wondered if this announcement echoed much of the same historical resource exploitation or if it was a step in the right direction for the development of black owned enterprise.

Shea Moinsture is a trusted brand for curly and kinky hair
Shea Moinsture is a trusted brand for “curly” and “kinky” hair

Sundial Brands is the umbrella company for brands such as Shea Moisture, and Nubian Heritage that have made considerable growth as a black family-owned natural hair care business from its ultra-loyal and expanding army of ‘curly’ and ‘kinky’ haired girls and guys looking for quality hair products. Bain Capital is an investment house owned by Mitt Romney – US Republican party representative who in many ways represents a nod to white male mainstream institutionalised money.

It is quite usual to invite institutional investors into a company to inject much needed capital and technical know-how to produce growth in the long term. But there is no denying that it can distort the control of resources. What does it mean to own your own resources and how important is it given the socio-political realities of the Black-American reality. Is that possible that mainstream investment can increase black entrepreneurial representation?

Richelieu Denis, CEO of Sundial -
Richelieu Denis, CEO of Sundial – “Recalling how he had helped his grandmother produce scented soaps as a youngster, Dennis teamed with Tubman in 1992 to launch Sundial Brands, a manufacturer and distributor of organic skin and hair care products for people of color.”

All the news outlets that have reported this have been stressing that the original owners (a family of African immigrants to the US) still maintains a majority stake in the company. I wonder if they have considered that an institutional investor doesn’t really need to have majority ownership to call the shots. There are other ways in which control can be exerted on investee companies like Sundial Brands and it is not unless we know the details of the agreement can we say with any certainty where the true control lies. As reported in the WSJ, terms of Bain’s investment were not disclosed.

Things that we might want to consider include:

1) What’s the time frame for the investment turn around?

2) What are the changes that will the brand have to make to appeal to a wider audience?

3) What was happening in the financials of the company prior to injection of capital from Bain Capital?

4) How does Bain Capital plan to recoup its investment and gains?

5) Does the irony of the situation mean we should hate it? I mean – Mitt Romney’s arguably a nice-guy regardless of whether he’s a representation of old institutional money.

Bain Capital’s involvement with the company may actually lead to an improvement in corporate governance and other factors fundamental to Sundial Brands LLC’s growth. However, the essence of the brand’s organic growth builds on a niche market that has been traditionally underserved by the mainstream. This juxtaposition is controversial to say the least. Hopefully it will not lead to the figurative bloodshed as portrayed in the dramatic sequence of events acted out in Rihanna’s theatrical pop-exploration. I believe that as long as Sundial Brands LLC keep their core values fundamental to their decision making, the black community will still benefit from quality products that they can cherish, the brand will gain much greater mass appeal, and the family that owns it will benefit from the injection of mainstream capital.

By: Stefanie Thomas

Quote of the day

Transparency
Better corporate social responsibility starts with greater transparency…

“Greater transparency is an unstoppable force. It is the product of growing demands from everybody with an interest in any corporation – its stakeholder web – and of rapid technological change, above all the spread of the Internet, that makes it far easier for firms to supply information, and harder for them to keep secrets. Firms now know that their internal e-mails may one day become public knowledge, for instance, and many big companies must co-exist with independent websites where employees can meet anonymously to air their grievances. With greater transparency will come greater accountability and better corporate behaviour. Rather than engage in futile resistance to it, firms should actively embrace transparency and rethink their values and generally get in better shape.”

– Don Tapscott, co-author The Naked Corporation

Going Green?

These changes take time...
These changes take time…

TIGHT SKIRTS, COFFEE CUPS AND GOVERNANCE

The Role of a Company Secretary

What comes to mind when you hear the title of secretary? Do your initial assumptions change depending on its modifiers, such as company – as in Company Secretary, or state – as in Secretary of State? If you think that secretary is a slightly demeaning or misleading title for someone with highly influential power, you are not alone. This continues to be a hotly debated topic among Company Secretaries globally. In what follows, I will sketch (and clarify) some common myths and misconceptions about the role.

It’s just a ‘glorified administration assistant’

Most Company Secretaries who have another qualification will tend to refer to the other qualification first, for example, “Chartered Accountant” or “Attorney at law”, or simply refer to it as “Corporate Legal Professional” to escape the stigma that is associated with the title as is. My recent forage into this area revealed that the role is poorly understood and there is some expectation that it carries little weight and is mainly administrative, when, in fact, the opposite is true. The role of a Company Secretary, especially since the recent financial crises, forms a principal part of any company’s governance structure and becomes, in many respects, a
key component of the company’s conscience and strategic growth model. Yes, the Company
Secretarial team prepares the board papers, but more importantly, the Company Secretary is an officer of the company and as such, has certain fiduciary responsibilities that obligate him/her to take a more examined look at what is happening throughout all aspects of the company’s operations.

It’s a role that mainly women occupy

Based on UK National Career Services statistics, the ratio of men to women working in this sector is 70:30. This may vary in the Caribbean, and in Jamaica, where women are represented in higher numbers in upper management roles. Certainly, within the LLM programme I am pursuing, specific to attaining the professional qualification GradISCA, the numbers are quite balanced.

The roles of General Counsel and Company Secretary go hand-in-hand

Increasingly, it seems that the role of Company Secretaries is being merged with General Counsel of the company, as seen in the statistics for the FTSE 100 companies (London Index of the largest 100 publicly traded companies). In many advertisements for Company Secretarial positions in The Gleaner or Jamaica Observer, I have seen the two merged in a job descriptor. However, the Director of Policy at the Institute of Chartered Secretaries, Peter Swabey, voiced the implicit conflicts present, saying that “there is a different focus for the two roles”. Essentially, the General Counsel should work closely with the CEO, advocating the company’s interest, and the Company Secretary should work closely with the Chairman, moulding relationships to ensure that governance structures are strong. Perhaps, attorneys are desirous of more control.

The position as Company Secretary should be the training ground for women

Many say it’s the perfect way for women to have a soft entry into the boardroom. However, this is a questionable motive, at best. Firstly, the role is very specific and independent of a person’s capacity to be a Board member. Secondly, as Peter Swabey maintains, based on discussions of industry professionals, the career progression is most in line with the role of Chairman of the Board.

The role is a “Dumping Ground” for all the tasks no one else wants to do or understands
With a platform that is often referred to as the ”dumping ground” for everything the Board doesn’t want to deal with, it’s hard to specify what the terms of reference of this position should be. In many instances, it tends to depend on the relationship which has been established by the Chairman and the other Board members. The “dumping ground” perception might have its advantages, as some professionals cite the variability in their portfolios as what attracts them to the job in the first place. However, for others variability tends to be a point of anxiety.

The name should be changed

In the time of Pharaohs, based on hieroglyphics on the caves, carvings of persons who were considered secretaries of the Pharaoh held the position of what we would now term the Prime Ministers who attended to the general governance of the society. The name has great history and context, and although modern interpretations conjure thoughts of tight skirts and coffee clean-ups, the significance of administration and governance has taken centre stage with the collapse of the financial sector. If we decide to change the name, my vote would be for including the word Priestess. But, luckily, I’m not the one with the casting vote.

By: Stefanie Thomas

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