The U.S. is in a profound reputation crisis. The prestige of the world’s most powerful democracy, its leaders, its financial sector, and its largest companies are at an all time low. To address this reputation crisis calls for a comprehensive recovery plan. Although local economic investments, tax cuts, and a financial bailout of many companies, industries, cities, and states will be necessary components of such a plan, they will be far from sufficient. They must be matched by a dramatic change in the national conversation, and complemented by a set of targeted initiatives designed to capitalize on the wave of optimism and hope that have carried Mr. Obama into the White House. Only in this way can the United States rebuild the mistrust that consumers here and abroad now have of the U.S., its leaders, and its institutions.
Clearly trust in the U.S., its leaders, and its institutions is now sorely lacking. It explains the now tarnished reputations of once revered institutions such as Goldman Sachs and Morgan Stanley. It also explains the sudden disappearance from the corporate landscape of respected companies like Bear Sterns, Merrill Lynch, Lehman Brothers, and Washington Mutual. And it’s a costly process: In 2008, over $382 billion in market value evaporated with the demise of these four corporate titans alone.
If the U.S. today is in a reputation crisis, it is because we have consistently failed to fulfill the expectations of our key constituencies around the world. In doing so, we have lost not only the trust and support of the American public, but also the respect and admiration of the international community. The recovery plan we need from the Obama administration must go far beyond the ones Congress has passed. It must address how the U.S., its leaders, and its institutions will rebuild our damaged reputation capital by living up to the promises we have made to our global stakeholder community.
Dr. Fombrun is the author of numerous books, including the path-breaking best-seller Reputation: Realizing Value from the Corporate Image, first released by Harvard Business School Press in 1996. Dr. Fombrun has published hundreds of articles in leading management journals, and is the creator of reputation management systems used by many companies around the world.
