Executive leaders, take note. Corporate reputations will suffer another long year of distrust and controversy thanks to a perfect storm of political campaigns, increased transparency and big-ticket screw-ups. Here are a few key indicators:
We have met the enemy and it is where we shop | Democratic candidates at all levels have targeted Wal-Mart as the official symbol of our nation's problems, despite the fact that – for better or for worse -- 84 percent of all Americans spend money there and 1.3 million work for the company. Appearing at an anti-Wal-Mart rally, Indiana Senator Evan Bayh told the New York Times that “Wal-Mart has become emblematic of the anxiety around the country, and the middle-class squeeze.” Well, maybe. But that’s their socioanalytical story and they’re sticking to it.
A flood of Katrina allegations | Whether or not they’re true, accusations of “disaster profiteering” will continue haunting government contractors hired for post-hurricane clean-up and reconstruction. An openly biased but comprehensive report from CorpWatch called “Big, Easy Money” is the latest collection of talking points that activists, politicians and media will use to promote the idea that “politically connected corporations ... have used their clout to win lucrative no-bid contracts with little or no accountability and who have done little or no work while ripping off the taxpayer."
Dude, your Dell is on fire | The largest consumer electronics product recall in history and ongoing headlines about the company’s financial troubles will add to public skepticism about the integrity of corporate brands. Add to that Ford’s announcement to shut 10 plants, potential strikes by Northwest Airline flight attendants, and other flair-ups to come.
Let’s look at the numbers | Beginning in December, public companies will be required to explain in a single, plain-English report the actual value of what they give their CEO, CFO, highest-paid executives and directors. The new rules also put new transparency on deferred compensation, pensions and stock option grants – to which some 80 companies are already under investigation for so-called “back-dating.” Officials at the Securities and Exchange Commission say public interest in compensation disclosure goes far beyond anything they’ve ever seen. This will have a huge impact on corporate life.
Beyond bad publicity | Before its corroded, leaking pipelines forced the shutdown of some of nation’s most important oil fields, BP enjoyed a brand reputation of progressive environmental consciousness and social responsibility. But as governments prepare to take legal action against one of the world’s largest corporations for gross negligence and lost revenues, BP’s carefully crafted image is being torn apart. Even a former advertising director lamented his epiphany that the company’s “beyond petroleum” promise was really never more than just a slogan. “It’s become mere marketing,” he wrote in a national op-ed piece. “Perhaps it always was, instead of a genuine attempt to engage the public in the debate or a corporate rallying cry to change the paradigm.” The ad guy. That’s gotta hurt.
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