Editorial: Where is your reputation?

During this recession, anyone who believes the damage done to the reputation of business is confined to the banks and the financial sector is kidding themselves.

by Matthew Gwyther, MT Editor
Last Updated: 09 Oct 2013

PR firm Edelman's annual Trust Barometer, published in January, found that almost two-thirds of those questioned trusted companies less this year than last. And the sample didn't consist of G20 protestors who amble around with a dog called Giro on the end of a piece of string. The 4,500 respondents were 'upper income, highly educated' people in 20 countries. And some will have lost their job since filling in the questionnaire, deepening scepticism further.

Business will have to watch its reputation closely over the coming years. One of the most contentious topics will be executive remuneration and the 'bonus culture'. Even when times were good, this was a sensitive area and, as that old warhorse Lord Bell warns in our round-table discussion, it will now turn red and raw. Especially if, as it seems, having got the rest of us to bail them out, the investment bankers have already put their noses back in the bonus trough. Even in the world of proper business, there are awkward questions to be answered - such as the evidence from Incomes Data Services showing that, whereas in 2000, FTSE-350 directors earned about 62 times as much as their average employees, that figure had risen to 104 times by the end of 2007. It's no longer just the likes of Polly Toynbee who find the disparity distasteful.

The reputation issues that surround Jaguar Land Rover are among a boot-full of worries besetting the company. Even before the great motoring public stopped buying new cars, the manufacturer was being hindered by the fact that its Chelsea tractors and sporting saloons for the over-fifties were right up with the biggest carbon-spewers around. The Midlands firm may now be owned by the Indians, but it's the last home-grown car brand of any size in the UK. CEO David Smith has one of the hardest jobs in British business keeping the wheels on the tarmac. (Talking of things green, MT's bigger and better Green Awards are now open at http://greenbusinessawards.com.)

In a world filled with recrimination, there has been plenty of mud slung at HR. Not least by regular MT contributor Luke Johnson, who wrote that 'human resources is a management term that should strike fear into the heart of every self-respecting entrepreneur'. We asked Stefan Stern for a balanced view on what HR is for. The answer is not simply dishing out P45s.

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