While tangible business indicators such as brand or product quality and management and leadership strength have the most important impact on stakeholder opinions of corporations, business intangibles such as corporate social responsibility and customer relationships have become significantly more important to stakeholders in the Asia-Pacific, according to a new study conducted by Edelman and research firm Wirthlin Worldwide.
“We believe there has been an important shift in stakeholder attitudes and expectations of corporations as they relate to managing long-term relationships,” says Alan VanderMolen, president of the Asia Pacific region for Edelman. “Clearly, as stakeholders evaluate their relationships with corporations, they are increasingly focused on how corporations treat their customers and their communities.”
For example, this year’s study found a five-fold increase in the number of respondents who cited “good service/after-sales service” as a key attribute when forming opinions about managing long-term relationships with corporations. Good service now rates as a top five driver in managing stakeholder relationships.
Similarly, attention to CSR grew substantially in importance in 2004. The study showed stakeholders placing 20 percent more importance on CSR as an area to investigate when considering long-term relationships with corporations. When asked why they increased their focus on CSR, 65 percent of respondents cited the need for corporations to ‘be socially responsible/care for society.” That compares with only 35 percent in 2003.
The study covered six stakeholder groups (government officials, senior business executives, NGOs/trade associations, up-scale consumers, media and employees) across nine Asia-Pacific markets.
Just as in 2003, quality products and services remain most important image driver for regional stakeholders. Rounding out the top-five drivers are: management/leadership, reputation/lack of scandal, profitability and good service/after-sales service.
“While business tangibles remain king, this research indicates a significant change in the way stakeholders view softer/intangible business factors,” says VanderMolen.
In thinking about what is most important for a “good and responsible” corporation, intangible and “softer” factors are now rivaling tangible business factors according to the stakeholders’ rankings. The 2004 survey found that “offers top quality products or services” and “stands behind its products and services when something goes wrong” were again identified as absolutely essential for a responsible corporation.
However, “providing profits to owners/shareholders” was significantly less important to respondents in 2004, whereas “concern about/active in doing something about local community welfare” was significantly more important.