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By Root 1549 0

perceptions of corporate reputations. Since then, they have published the results of their evaluations as an annual list of the 60 “most visible companies in America,” ranked by their reputation. Achieving and maintaining a great corporate reputation is an increasing preoccupation with visionary corporate leaders. Jeffrey Immelt, chairman of the board and CEO of General Electric (GE), in his letter accompanying GE’s 2002 Annual Report, made no bones about it. “We spend billions each year on improving our training, enforcing our compliance with ethical norms, and reinforcing our values,” he said, “all to preserve our culture and protect one of our most valuable assets—our reputation.”9 When financier Warren Buffett took over troubled brokerage firm Salomon Brothers after securities violations threatened to wreck the company, he went before the U.S. Congress, apologized for the employees’ transgressions, and issued a stern warning to any that might think of following in their footsteps. “Lose money for the firm,” he told them, “and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless.”10

Unfortunately, a fair amount of the recent interest in reputation revolves around creating and managing corporate reputation as an extension of brand awareness in the marketplace, an effort colonized by public relations and corporate communications departments and consultants. When I recently Googled “reputation management,” I got 68 million hits and 16 or so paid ads. Communication strategists, research companies, law firms, and consultants of all stripes and hues have sprung up to deal with managing and repairing reputation. Fine minds and strategic thinkers have broken it all down into “6 Dimensions,” “18 Immutable Laws,” and “Communication Gaps” that must be learned, mastered, adhered to, or filled.

Certainly, business in a hypermediated world has a place for reputation and crisis management. Kryptonite learned that lesson the hard way. Let us not forget that companies are the by-product of a lot of blood, sweat, and tears. When things go bad, a lot of human effort and resources are dissipated: real loss, real dissipation, degradation of value that was built on the backs of real people. Reputation, to the degree that stakeholders see it as an external surface representing all this effort, is an extension of brand, and the building of reputation in the marketplace is an essential component of any business strategy. But reputation is not the same as brand, and does not equate automatically with brand awareness. Think of the brand awareness built up in the marketplace by companies such as ExxonMobil, J&J, GE, and Microsoft. Each of these companies is known by everyone. All of these companies have achieved almost total brand saturation in their markets, but not all of them share the same reputations.

The problem with external approaches to corporate reputation, and by extension trust, is that they look at reputation as a silo to be managed, a story to be spun. The mentality of much of this thought seems to go like this: The corporation is under siege from the marauding forces of information and transparency, and every company should be armed with a plan and a phalanx of experts ready to go to war on the great battlefield of public opinion, both proactively to extend the brand and reactively in times of PR crisis. Whoever can gain control of the message can prevail. This thinking, with its roots in fortress capitalism, stands little chance of success today. To truly thrive in the internetworked world, business and the people who labor in business need to find a way to operate within the new conditions of transparency and interconnectedness that define the playing field of economic endeavor, to thrive because of and not in spite of these new conditions. Even a company like fast-food restaurateur McDonald’s, which grew up in the pretransparent world to become a formidable and globally recognized brand, has embraced this new relationship with its stakeholders. “We welcome transparency,” CEO Jim Skinner told