Employees critical to managing reputation risk


Reputation is becoming harder to manage as businesses become more complex and diverse.

SenateSHJ’s Reputation Reality 2017 found customer dissatisfaction and employee conduct as leading risks for New Zealand organisations. In Australia, companies identified ethics and social governance as major triggers for reputation risk.

Increasing diversity among employees, customers and stakeholders is driving new expectations of organisations and their behaviour.

Diversity means different value sets and tolerance levels. The way things are done in one culture may be inappropriate in another. Sometimes, the way business is done in one country is considered unethical in another. Navigating this minefield with integrity is critical.

I was invited to speak at the Australia New Zealand Infant Nutrition Council conference recently where we discussed the melamine milk scandal in China in 2008. Sanlu Group, one of the largest dairy producers in China at the time, was identified as one of the main culprits, but more companies were implicated as the scandal unfolded. Fonterra had a 43% stake in Sanlu. A key lesson from the crisis is that no matter how robust you think your systems are – what your partners do, or don’t do, has significant reputation implications for you.

In my presentation to the New Zealand Institute of Directors’ Eye on Asia event this week, I talked about how to navigate different cultures and business practices. Often businesses forget that one of their strongest assets is in fact their staff. As workplace teams become more diverse businesses have much greater direct access to diverse thoughts and experiences. Ensuring that employees feel empowered to engage and contribute is critical for business success.

The context in which businesses operate today is changing at an unprecedented rate. It is an environment in which traditional approaches to reputation management will no longer work.

Reputation management today involves finding the link between a company’s culture, purpose and its reputation. So you need to think about how you promote yourself, how you protect yourself and how you engage your people.

Click here to see Ziena discuss the role diversity plays in protecting and enhancing an organisation's reputation.