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How the behaviour of corporate leaders affects corporate reputation
Moleleki, Matawana Aletta
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Reputation is the strongest determinant of any corporation’s sustainability. Stock prices can always come back, and business strategies can always be changed, but when an organisation’s reputation is gravely injured, its recovery is difficult, long term, and uncertain. It is quite notable in the corporate industry that individual corporate leaders possess some reputation. Consider leaders like The Oppenheimers, Jack Welch, Steve Jobs, Bill Gates, Richard Branson, Patrice Motsepe, Martha Steward, Maria Ramos, and Nonkululeko Nyembezi–Heita. In many cases, the person becomes synonymous with the company. The image and reputation of the CEO becomes the image and reputation of the company. A risk on their reputation is a threat to the survival of the enterprise. Leaders who have built a strong corporate reputation know what it takes: an internal culture that forges a positive opinion of the company by successfully coping with both expected and anticipated challenges. They know that Public Relations is not a bandage that will cover risky behaviour. Most of all, they know that they must understand the role played by their behaviour; that the public’s perception does not end only with the product, but also with who leads the corporation and how. They know that their leadership style, strategies and personal lives are of public interest, and that every company’s solution must be unique. Cross–disciplinary theorists view corporate reputations as strategic assets and as a source of economic value. A good feeling about a company, its activities, workplace, past performance and future prospects by key stakeholders can lead to positive stakeholder decisions about the company. Corporate reputation has attracted interest from a wide range of academic disciplines. It is also a growing focus for business and media attention. This paper examines the construct of corporate reputation, and the effect brought about by the behaviour of the corporation’s leadership. Firstly, I define reputation in terms of the perceived experiences of stakeholders and their emotions, while the consequences of reputation are defined as the behavioural support of stakeholders towards the business. I then move on to consider how reputation has been measured by applying the corporate Reputation Quotient (RQ) of Harris–Fombrun. The RQ is a comprehensive measuring method of corporate reputation that was created specifically to capture the perceptions of any corporate stakeholder group, such as leaders, consumers, investors, employees, or key influencers. The instrument enables research on the drivers of a company's reputation, and allows the comparison of reputations both within and across industries. With a clearer understanding of the construct of corporate reputation and the allied constructs of image and identity, researchers are now well placed to test the relationships widely claimed by practitioners between corporate reputation and other variables, such as corporate leaders, commercial performance, employee and customer satisfaction. The review ends by illustrating some of the issues that can be assessed from the basis of a clearer conceptualisation of reputation and its measurement.