Financial services firms admit that they invited negative public perception by their actions—or inactions—during the global economic crisis, according to the 2012 Makovsky Wall Street Reputation Study of marketing and communications executives in the industry. Negative public perception topped the list of challenges these firms must overcome in the next year.
The study also revealed that three in four (74 percent) executives believe that increased regulation of the financial services industry will help their firms improve reputations and trust with customers faster. And 81 percent are worried about negative public reaction to executive compensation in the industry.
The study was commissioned by Makovsky and conducted online by Echo Research.
“Whereas issues such as capital and liquidity challenges, weak financial performance, and the lingering impact of the subprime mortgage crisis have been the most important factors in tarnishing the industry’s image, the study found, the respondents are now looking to management and product and service quality as well as their company’s commitment to rebuilding reputation as most critical,” says Scott Tangney, executive vice president and head of the financial services practice at Makovsky.
“There has been a shift in priority from recovering and stabilizing to focusing on customer satisfaction, employee communications and improving public perception. Our study reveals that companies are in transition, and this new strategy involves both external and internal integrated communications efforts.”
In fact, the study revealed that 73 percent said their marketing and communications departments grew in importance over the past year.
In probably the first indication of Occupy Wall Street’s impact on financial services companies, 53 percent of those surveyed said that Occupy Wall Street had a real impact on their business. And 71 percent said they expect Occupy Wall Street will continue beyond the presidential election in the fall. And 38 percent of executives said they were surprised by the Occupy Wall Street movement.
When asked to give a public relations grade for the financial services industry, 57 percent graded “average,” “below average” or “failing.” Thirty-four percent (34 percent) graded “above average” and 9 percent said “perfect.”
When asked what financial services firms currently have the best corporate reputation in the industry, a number of companies were named: more than one third of communications and marketing executives reported Wells Fargo (36 percent) or Bank of America (35 percent). Among other top firms named were Citibank (27 percent) and Chase (12 percent).