USAA, which provides a wide range of financial services to U.S. servicemen and women, has the best reputation in the financial services industry, according to the latest Reputation Institute/Harris Interactive study, conducted in conjunction with American Banker.
USAA beat out TIAA-CREF, which financial products and investment advice to teachers, and Charles Schwab & Company, the discount brokerage, to take first place in the study, with the Navy Federal Credit Union and American Express rounding out the top five. In all, 40 financial institutions—including banks, brokerages, insurance companies, and credit card providers—were included in the study.
“More than ever, reputation has become an integral part of overall performance for financial services companies,” says Charles Fombrun, executive director of the Reputation Institute and professor of management at the Stern School of Business at NYU. “The Financial Services Reputation Quotient is distinctive in that it uses a common set of standards to quantify public perceptions of performance across a broad range of financial services sectors.”
The Financial Services Reputation Quotient measures corporate reputation by examining how key stakeholder groups—the public, customers, general investors, corporate employees, boycotters, and those who are concerned about their privacy—perceive financial services companies based on 24 attributes classified into seven dimensions of reputation:
- emotional appeal
- products & services
- vision & leadership
- financial performance
- workplace environment
- social responsibility
- financial services performance
“Four of the top five companies are niche players who know and serve their customers very well,” says Dr. Joy Sever, senior vice president of Harris Interactive, “and it’s paid off nicely for them.”
Banks, on the other hand, despite spending millions of dollars on ad campaigns touting community involvement and customer service, all ranked in the bottom half of the companies surveyed, earning nine out of the bottom ten slots. The lowest scores were recorded by PNC Bank, MBNA, and Fleet Boston Financial.
“Even though the banks are saying they put customers first, the customers aren’t convinced. Mergers, increased fees and poor customer service were all cited in the survey as sources of displeasure with banks,” Silver says.