The American business magnate Warren Buffet was right when he said “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

These days, societies demand consistency and coherence in what companies and brands say and how they act.

Why is corporate reputation so important? 

A good reputation is an increasingly decisive element in a firm’s competitiveness.  

Companies with positive reputations enjoy not only more customer loyalty, but also a better selection of partners and more productive, better-qualified employees, easier access to outside talent, and more room for negotiation with public authorities. 

Therefore, a robust policy of Corporate Social Responsibility as a crosscutting strategy will directly influence long-term outcomes.  

First mistake: thinking that reputation only impacts large companies

In cases of reputation problems, small and medium-sized firms rarely make national or international headlines. 

Nevertheless, bad news travels at hyper speed, especially across social media. And in contrast to large companies, small and medium-sized businesses have fewer resources to compensate for possible damage to their reputations. 

It’s not question of a company’s size, but of its willingness to think about the company as a social asset that has a role to play a role in its sector.

5 ways to define your corporate reputation

In a new age in which news travels fast and competition is global, companies need to master a series of corporate reputation techniques that help define their purpose as well as avoid reputation risk and stop bad actions or inappropriate behavior(including when indirect). 

  • The best tool is prevention

The best way to tackle risks to your company’s reputation is to prevent them whenever possible. 

Establish an organizational risk map that identifies key areas and defines early alert signs. Although reputational risks tend to be difficult to evaluate, it’s important to try to classify them hierarchically, according to both their probability and extent of possible damage.

The extent of the damage to corporate reputation will depend on the industry and type of product or service. Identified risks should be considered in planning and prior to making important decisions

  • The medium is the message

The crisis communication phase starts as soon as a reputation issue is detected. The issue’s impact will be greater or lesser depending on the implementation of the strategy in this phase.  

After all, the manner in which a company handles a crisis also affects its reputation

The key is to find the balance between transparent communication and limiting information and admissions of guilt as legally advised. 

  • Don’t make promises you can’t keep

When  PR crisis erupts, coherence in a company’s word and deed is critical. 

You might be able to control the initial reaction by promising more than you can deliver, but over the medium and long term customers will lose even more confidence in the company.

  • Follow Crisis Manual protocol

A good Crisis Manual will establish how the organization will act in an emergency. 

It should also include simulations of possible crisis situations—at least up to a certain point—in order to confirm the effectiveness of potential strategies.

The goal is to always avoid making improvised decisions. 

  • Crises impact the leadership

One must also keep in mind that a firm’s reputation issue can also have a significant impact on the organization’s leadership. 

It is increasingly important, therefore, for leaders to carefully cultivate their own reputations. At Thinking Heads, we’re experts in providing leaders with the necessary tools to skillfully manage their strengths. 

  • The importance of the “Day After”

It can take time to restore a company’s damaged reputation. There are ways, however, to help and speed up the process. 

In a case of quality defects, for example, customer confidence can be restored if the company can prove it has effectively improved quality control—additional security measures, for example—as well as be able provide guarantees and relevant certifications. 

If the issue included a breach of social norms, making a sincere commitment can help rebuild trust. This strategy might include sponsorships, marketing related to the particular social issue, and charitable contributions. 

But this is precisely when a company must do away with mere appearances and ensure that the public recognizes a sustained commitment on the company’s part. If not, the impression quickly becomes that the campaign is only a means to and end, and generally has the opposite effect. 


All companies are susceptible to the consequences of a reputation crisis, regardless of their size and sector. 

By following a few basic principles, a firm can regain stakeholders’ trust more quickly. The experience also can encourage them to act more prudently in the future, as well as provide the tools to manage other crises that might arise. In these cases, the successful management of a crisis becomes a way of gaining a competitive advantage.