Forbes: The World’s Most Reputable Companies in 2015
Forbes: The World’s Most Reputable Companies in 2015
The World’s Most Reputable Companies In 2015
By Susan Adams
When the news broke last week that the European Union was officially charging Google with cheating consumers and competitors by distorting Web search results to lure visitors to its own shopping service, what did that do to Google’s reputation in Europe? Likely nothing, says Kasper Ulf Nielsen, executive partner and cofounder of Reputation Institute [RI], the 18-year-old reputation management consulting firm based in New York and Copenhagen, which just released a list of what it deems the 100 most reputable companies in the world. Google scores No. 2 on the list, just behind BMW and above Daimler. “Consumers really love Google,” says Nielsen. “They trust it and admire it. You have to ask, who has the stronger reputation, Google or the European Union commissioner?” At least for now, Google wins, he says.
For the last 10 years, Nielsen’s firm has been putting out its list, called the Global RepTrak 100. It comes from a three-month-long survey it conducted from January through March, of 61,000 people in 15 countries: Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russia, South Korea, Spain the U.K. and the U.S. It started with a list of the world’s 500 largest companies by revenue, then culled that to 150 using reputation lists it’s put together over time. To be considered, a company had to be well known in the countries surveyed and have revenues of more than $6 billion in the U.S. or $1 billion globally.
RI showed each respondent a list of 20 companies and asked if the person was familiar or very familiar with them. If the person was familiar with a firm, then it offered four basic statements: “I trust this company,” “I admire and respect this company,” “I have a good feeling about this company,” and “This company has an overall good reputation.” Next it asked respondents to rate a series of statements like, “This company makes or sells innovative products or innovates in the way it does business.” The survey measured how consumers felt on seven of what it calls “dimensions:” performance, products/services, innovation, workplace, governance, citizenship and leadership, all of which fall under the four broad categories of esteem, admire, trust and feeling.
The Global RepTrak list stands out from other corporate lists we cover, like the most ethical and most trustworthy companies, because it aims to quantify the way companies are perceived by consumers, or “stakeholders” as Nielsen calls them, rather than looking at how companies manage their internal affairs. The list measures public perceptions rather than actual corporate practices. According to RI’s data, 83% of consumers say they would definitely buy products sold by companies with top reputations while only 9% want to buy from companies with poor reputations.
How has Google hammered down such a strong reputation? Its search engine is incredibly powerful and high-functioning, a tool that few people feel they can live without, and it has a well-known 10-part corporate credo displayed prominently on its corporate site, which includes the statement, “You can make money without doing evil.” It also has told a convincing story about itself to the word, says Nielsen, as a place that treats its employees extremely well, offering perks like cafeterias packed with healthy food, an on-campus laundry service, subsidized massages and at the Googleplex headquarters in Mountain View, CA, a sports complex that houses a roller hockey rink.
Google has said it does not engage in anti-competitive practices but Nielsen’s RI colleague Stephen Hahn-Griffiths cautions that Google needs to tread carefully on anti-trust issues. It should cooperate with European regulators and be transparent about its practices.
It’s intriguing that two car companies are also at the top of the reputation list, given that their products are gas-guzzling pollution-producers. But BMW makes an effort to portray itself not just as an auto maker but as a local business wherever it has dealers and production facilities, says Nielsen, providing jobs and forming strong relationships with consumers. Its reputation as a distinctive brand with a premium on reliable engineering and safety helps it rise to the top in consumers’ minds. As early as 1980 the company was producing cars that got 26 miles per gallon and nowadays environmentalists are surely pleased about its new electric i3. “Over the last five to ten years they have really put a lot into stakeholder perception and input,” says Nielsen. (BMW is a RI client.)
There are five other carmakers on the list: Daimler at No. 3, Volkswagen at No. 14, Honda at No. 61, Ford at No. 65 and General Motors at No. 96. Honda took the worst reputation hit of the group this year after a massive international recall of faulty airbags in February. CEO and President Takanobu Ito said he would step down this coming June. Honda wound up recalling some 25 million cars, knocking the company down 19 slots this year over last.
The fourth company on the list, Rolex , is an interesting case because it doesn’t score well across the board. “They’re very Swiss, they’re a very closed company and they really focus on high quality but they’re not seen as innovative,” says Nielsen. Yet Rolex has been able to forge a strong bond with consumers because its products are seen as high quality, long-lasting and linked to tradition and family. Nielsen says the company’s decision to use tennis star Roger Federer as a spokesman has helped cement its strong reputation, since Federer ranked an impressive second in a study RI did on the most trusted people in the world (Nelson Mandela was alive when RI did the study and he ranked No. 1.)
One company that has done well every year RI has done the corporate reputation study, and whose reputation just keeps getting stronger: Lego, the Danish maker of colorful plastic construction bricks. It’s No. 5 on the world list and in North America, it scores as the No. 1 most reputable company, ahead of much-loved American stalwarts like Disney, Coca-Cola and Apple. At a time when it’s tough to pry children from their sedentary fixation on iPads and other digital devices, parents love the idea that their offspring will play with a toy with no screen that encourages creativity. They also have good memories of building with the colorful plastic blocks when they were children, and they can play alongside their kids. Plus the company promotes Lego construction as a hobby for adults. Meantime Lego has embraced the digital era, featuring in a hit movie last year and producing apps and games for iPads and smartphones.
The most reputable list is also interesting for the companies that are absent. There are no energy producers, although ExxonMobil and BP have the revenues and name recognition to be considered by survey-takers. “They are still seen as unethical, polluting and failing to protect the environment,” says Nielsen. “They’re seen as almost too profitable, making money at the expense of consumers.” People blame energy producers when oil prices rise and don’t credit them when prices fall. “There’s a tremendous opportunity for oil and gas companies to tell a better story,” says Nielsen. “But they’re starting at such a deficit.”
Global financial services companies also don’t make the cut. “They’re seen as unethical, greedy, self-serving, and not caring about anything else but themselves and profits,” says Nielsen. Though three companies that provide credit cards are on the list: Visa at No. 27, Mastercard at No. 49 and American Express at No. 93.
One shift this year: In 2014 only one pharmaceutical company, Abbott Laboratories, made it into the top 100. Abbott makes Ensure, the popular nutritional supplement drink for seniors. But while respondents were familiar with Eli Lilly, Pfizer, AstraZeneca, Merck, Bristol-Myers Squibb and GlaxoSmithKlein, none of them made the cut in 2014. This year GSK and Bristol-Myers both squeaked into the top 100, tied at No. 97. GSK’s inclusion on the list is especially striking, given that the British drugmaker was caught up in a well-publicized bribery scandal in China last year. In September a Chinese court fined GSK $500 million and five executives in its local subsidiary were found guilty. Glaxo has cooperated with the case ane even issued an apology in English and in Chinese. Nielsen notes that there is not widespread trust of the Chinese government, which protected GSK from serious reputational damage.
See our slideshow above for the top 26 companies on the list (there was a tie for several places, including 25th; hence our inclusion of 26 companies in the slides). The complete list of 100 companies is below.