CORPORATE IMAGE: An Expression of Changing Responsibilities Corporate Image the mental picture that springs up at the mention of a firm’s name n ame reflects how the company is perceived as a whole a composite composite psychological impression impression that continually changes with the firm’s circumtances, media coverage, performance, etc a genuine asset Purpose of this discussion: Evaluate the increased effort directed toward building a corporate image and attempt to determine whether this is an indication of the corporation’ s acceptance of moral responsibility beyond profit motive Corporate Image for the Corporate “PUBLICS” Peter Drucker: the essence of and purpose of a corporation is not its economic performance or in its formal rules, but in the human relationships both between the members of the corporation and between the corporation and the citizens outside of it. Berle: corporate powers were powers in trust for stockholders. Thus, corporation’s purpose is to give their shareholders their fair share in the th e profits. Dodd: corporate powers were held in trust for the entire community. Therefore, business is permitted and encouraged by the law primarily because it is of service to the community rather than because it is a source of profit to the owners. Hence, corporations should attempt to project their image of “good citizens” to their neighbors. neighbors . This “neighbors” is the general community which is also the “public” being referred to in this topic. In order to be good citizens, corporations should provide quality goods at low cost, improved goods and services through technology, and honest and intelligent service. service. Corporate Image for EMPLOYESS Creation of the employees’ image of the corporation is top management’s responsibility. Corporate sense of social responsibility and responsibility toward the employees is evidenced in tis credos or “we believes” Proof of a company’s acceptance of its broad responsibilities to its employees is by practicing what it preaches in its credo like providing promotion opportunites and financial assistance for education Richard Lester’s idea of corporate management is that LABOR IS A COMMODITY As a result of union activities and the growth of socially responsible professional management, the idea of employment as a work-life attachment to a firm was developed
Corporate Image for the TRADE Trade’s image of the company is an essential part in building long -lasting loyalty towards a company and its products The image that the trade has of the company comes from the opinions they have of a corpor ation’s salesmen, advertising, sales or trade pollicies, and the corporate trade mark One way gaining a good corporate image for the trade is through associating or partnering with well-known distributors
Corporate Image for the LOCAL COMMUNITY Stresses good industrial citizenship which means corporations should become part of the community and cultivating genuinely friendly relationships with the citizens living within it William Gossett: “We can hope that whether or not there is a corporate conscience, there may atleast be corporations with conscientious men.” Thus, each groups in the community (esp. schools, churches, local government, social service organizations, etc) are expected to contribute their share in the development of the society and its people. In return the community expects the corporations to give their fair share in the achievement of this goal, by way of providing regular employment, purchase goods and services locally, put more money in circulation in the community, investing in charitable activities and paying taxes to support the local government. Companies are encouraged to do things not because they are required but because they are right. They are to initiate programs of action to earn community respect and confidence. Benefits of having good relationship between the company and the local community:
Recruitment of better workers
Reduction of turnover and absenteeism
Improvement of job satisfaction and morale
Increased sales
Creation of a better local understanding and acceptance of the company
Corporate Image for GOVERNMENT
Modern corporation is now accepting moral responsibilities to its public even if it’s only due to the pressures exercised by the government The gov’t force the profit-making organizations to obey the moral rules and basic values of the democratic society in order to prevent conflict between the company, the community and the government Sen. Thurston Morton: “…businessmen should be both articulate & aggressive not only in helping to shape policies & programs which affect them directly as businessmen, but they should also take an intense interest in the broader problems which concern all citizens.” Thus corporations should engage themselves in worthwhile political causes for them to be able to effectively respond to the public opinion and to the rapidly developing beliefs and values of their state. Politics could only harm one’s business endeavors and interests once man sought to obtain special privileges for himself through his political activities
Corporate Image for the INVESTING COMMUNITY The primary purpose of projecting a favorable image to investing community is to inspire confidence in management policies, confidence that can result in a decision to invest. This involves convincing this community that the company is well run, progressive, and with prospects for continuous growth Benefits from securing favorable investor recognition:
Fair & accurate market appraisal of a company’s business, industry position and prospects
Continuing stockholder support for management’s long-range plans & policies
Improved public acceptance of newly issued securities
Preferred position with respect to possible acquisitions
Prestige in trade, industry, and customer relations through an improved standing in the financial community
However, it’s not all about what the corporation may derive from these financing institutions, it’s also about what these institutions can expect from them in return by
way of full disclosure of corporate financial affairs through annual reporting & election of auditors by shareholders to ensure the security of their investments.
Corporate Image Measurement The importance that large corporations places on projecting good image is illustrated in the increasing advertising expenditures, which rose to 20.9% between 1953 & 1958 The Opinion Research Corporation conducted a depth interview format in which highly skilled interviewers guided respondents through a portrayal of their images of corporations This is done since corporations carry corporate images that differ in fine particulars. Some stand out for their scientific characters, others for their service to the customer, others for their employee-handling. Through research, judgments on these distinguishable points may be discovered, with the ultimate goal of improving image profiles This study proves that corporate images perceived relate to how people behave toward a given company since consumers with favorabel images of consumer goods companies are much more likely to recommend such companies’ products.
