The Reputation Landscape is changing in France

By Kasper Ulf Nielsen and Olivier Forlini, Reputation Institute

The French public is expecting more from companies than ever before. It is not enough to deliver strong financial results companies also need to deliver on the social impact to win the trust and support with the French consumers. To be a top 50 company in France you need to have a strong reputation. You need a RepTrak® score of 74 to break into the top 50 with is up from 71 in 2016. This underlines that companies needs to do more and better to win the trust and support of the French public. And the ones who do this benefit. We see that reputation has a very strong impact on business success. 74% of the French public will definitely recommend a company with an excellent reputation compared to just 42% for companies with an average reputation. So investing in reputation pays off.

MichelinMichelin, Lego Group, SEB, BIC, Bosch, and Decathlon all have an excellent reputation with RepTrak® scores above 80. Michelin tops the list for the second year in a row, and has been in the top 10 for the past 3 years.

Decathlon, the sports and outdoor retailers has seen a strong increase across several dimensions and are seeing the benefits in support. In 2017 69% would definitely recommend the company up from 52% in 2016. And 46% would definitely welcome Decathlon to their neighborhood up from 32% in 2016. These are critical supportive behaviors for a big box retailers, whose growth is dependent on the license to build new stores in cities across the country. Through a dedicated effort, Decathlon is generating the support from local communities, which will help them expand their business.

Decathlon

The French Companies are falling behind International competitors for Reputation in France.

The France RepTrak® 2017 outlines a key challenge for the large French companies. They are falling behind international competitors when it comes to levels of trust and support with the general public in their home country.

French-vs-International-Companies

The average reputation of French companies in France is 67,3 compared with 70,7 for international companies. The French companies are falling behind on all 7 drivers of reputation and has the largest gap within Innovation, Leadership, Workplace, and Governance.

So how can companies who have 50-100 years of history and legacy not be more trusted than international companies who just operate and sell their products in the country? The answer is clear – the French companies are not telling their story. They are not engaging with the general public in a way that resonates and creates the strong emotional bond needed to win their trust and support.

Among the top 10 companies there are only 4 French companies: Michelin, Groupe SEB, BIC, and Decathlon. Companies like LEGO, Bosch, Philips, Rolex, and Nintendo have been able to build a strong relationship with the French consumers based on direct and authentic communication.

But the French companies have an open invitation from the French general public to tell their story. They want to know more about what the company is doing within the specific dimensions of reputation. How is the company providing high quality products and services, how is it meeting the needs of customers, what is it doing to have a positive influence on the French society, and how is the company and its CEO showing strong leadership in France? Those are the key drivers of reputation and what really matters to the French general public. But today the French companies are not communicating clearly about this. And that is a lost opportunity, because most of the companies have great stories to tell. But they have lost focus and are just communicating about financial performance and strategy. They are lacking the emotional story telling which builds trust and admiration among the people who they need support from in France.

The trend is also seen when we look at the largest and most powerful French companies from the stock index CAC 40. These 40 companies are falling behind when it comes to reputation. Overall they only have an average reputation with a RepTrak® score of 66,7, and compared to the top 50 companies they are a full 10 points behind. The CAC 40 companies are behind on all dimensions even the Financial Performance and Leadership where you would expect the largest institutions in France to do well. When asked about the CAC 40 companies only 19% agree that they are “good corporate citizen, who supports good causes and protects the environment”, and only 16% agree that they are “appealing places to work, who treats its employees well”. In an economy where you need to attract and retain the best people, and secure the license to operate these are weak points that should be addressed by the largest companies in France.

CAC-40-vs-Top-50

The results point to the fact that French companies need to engage in the conversation about the society in a much more direct way. The French public wants to know what the company is doing to have a positive impact on the French society, how are they part of the solution to the challenges of the future, and what will they do to move both their own company but also the country forward. The public is seeing a lack of leadership within the French companies, and are much more favorable towards International companies as being part of the solution.

The call for Social Performance

When evaluating companies the French public are now expecting more when it comes to Corporate Social Responsibility. 43% of reputation is now made up of perceptions for citizenship, governance, and workplace. This means, that to win the trust and support of the public companies need to convince people that they have a positive impact on society, are operating with high ethics, are open and transparent, and treat their employees well. Among the top 10 drivers of reputation, there are 5 CSR attributes, which tells a story of changing expectations in France. People expect much more from the companies today than just good products, and solid financial performance. They are looking for companies to play a role in their lives and in society. And this is a tough challenge for many companies and leaders, who are not comfortable communicating and engaging on these social aspects. But the results are clear, if you don’t tell your story you will not get the trust, respect, and support that you need to increase your sales, attract the right people, and get the benefit of the doubt in a crisis.

France-RepTrak-Pulse

Some companies have found a way to leverage their CSR activities and they are seeing the impact on overall reputation as well. Airbus, Schneider Electric, Air Liquide, and Sanofi are all seeing increases in the CSR perception, which leads to improvements in overall Reputation. On the other side of the spectrum companies like Carrefour, L’Oréal, Veolia, and Orange are declining in perception around CSR and they are seeing the impact from a falling reputation.

The frustrating point about this for the companies who are declining is that most of them are doing a lot of good. They are engaging in the French society and do take on elements of good governance and workplace. Many of them have specific CSR strategies and programs. So why are they not seeing the positive reaction from the public?

In many cases it’s because they simply do not communicate about the efforts. They keep focusing on their products in their marketing and communication and they are not able to link their actions back to the company behind the brands. In other cases there is simply a misalignment between what the company perceives to be good social responsibility and what the public expects from them. So while they are spending millions of € on programs they are not seeing any return on reputation.

Taking action to improve reputation and support

The results from the France RepTrak® 2017 show a clear way forward for companies who want to improve their reputation in France:

  1. Identify your company reputation. Where are you strong and where are there weaknesses in the perception of your company
  2. Understand what matters to the French public. Use the research to identify the key drivers of reputation and where you will get the most return on investment from your communication
  3. Develop a focused communication plan that addresses the key drivers of reputation, and start telling your story

In today’s world it is not about your company, it is about the stakeholders. Companies need to align their actions to what the public, the customers, and the employees expect if they want to gain a strong reputation, and get the support they need to achieve their business goals.

For more information, download the full France RepTrak® Report:
https://www.reputationinstitute.com/2017-France-RepTrak

 

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