Reputations of corporations in the developed world are subpar at best, thanks to a "stark contrast" between what the street and general public expect, said Richard Poston, director-global public affairs at Telefonica during the Holmes Report's Global PR Summit in Miami.
Mr. Poston provided this point of view during a panel conversation around Burson-Marsteller research that showed the reputations of corporations in the developed world are much worse than those in the developing world.
"The tenure of the CEO is three years. It's relatively short-term. Financial markets' [focus] are relatively short-term. They're interested in quarterly profit. But if the market tenure is short-term and the CEO is short-term, there's a disconnect," said Mr. Poston. That disconnect is with the lengthy amount of time it takes to create a "sustainable business," which is necessary when it comes to changing the general public's perception, he said.
There's also a shift in attitude toward startups and new endeavors that don't look like big corporations. Mr. Poston cited a survey his company conducted on millennial optimism for the future. In Latin America 60% of respondents are optimistic, compared to 40% in the U.S. In Europe, only 20% of millennials are optimistic, not suprising given that nearly half the age group is unemployed in countries like Spain. "Big corporations aren't necessarily going to be the provider of jobs in the way they were in the past," he said.
The results from the corporate reputation study weren't surprising to Pia De Lima, VP-corporate communications for the Americas and European Union at Western Union. She attributed the divide to the way media is perceived in different markets.
"The developed world is a very engaged audience. They have bold journalism, active consumerism and platforms shared by regulators, academics and stakeholders. There's a lot of opinion shared. The ultimate reader is influenced by all this debate," she said. "Now take the scene in Asia-Pacific. Apart from India becoming a vocal media audience, in the rest of the region, leaving Australia out, it's a controlled environment where consumers don't get a chance to hear the truth. It's reflective of the economic landscape and level of democracy in those nations."
The panelists' bottom line was that it falls to the CEO, who is responsible for both the bottom line and corporate reputation, to find ways to appeal to both constituencies. The trick, they said, is finding specialists beyond the CEO who can speak to different stakeholders, whether they're employees or shareholders.
Corporate social responsibility that drives business growth while "paving the societies in which they operate" can also help change how a company is perceived among consumers, investors and ultimately regulators, noted Mr. Poston. He used the example of a Telefonica program that developed primary schools in South America to battle the "perceived problem" of child labor and the ensuing generations that don't pursue an education. Continued education promotes development and business, so it's a "sweet spot in shared value," he said. "You have to run a global local business."
The panel, dubbed "Perceptions of Corporations: a World Divided," featured moderator Ramiro Prudencio, Burson-Marsteller's Latin America CEO; Ms. De Lima; Billy Mann, president of Penn Schoen Berland; and Mr. Poston.