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Stakeholders, Identity and Reputation 83

performance and a range of organizational issues (such as supporting equality of
opportunity and diversity, good environmental performance, improved ethical
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behaviour, and so on). But these rankings do not take into account that stakeholder
opinions vary and that stakeholder groups attend to very different cues when form-
ing an opinion of an organization. Some stakeholder groups would not be at all
interested in some of these areas, or would in any case not rate them in their evalu-
ation of the company. What is more, the authentic and distinctive values that a
company may project, and that are extracted from its organizational identity, come
on top of the general professional values that it must endorse, and stakeholder appre-
ciation of such core values does not always shine through and is not fully captured
in publicly syndicated measures.
A reputation thus varies by stakeholder groups. In fact, it may be better to con-
ceive of different reputations that various stakeholder groups hold of an organization.
Taking into account the point made earlier that stakeholders have very different
interests in the organization, different measures of reputations that include the very
different attributes upon which organizations are valued may also be needed. In fact,
according to some academic commentators, because of the recognition that there are
multiple stakeholders ‘no across-the-board measure of reputation is or can be valid
for all stakeholders’. 45

The nature of reputation

Before the chapter tackles the problem of how organizations can account for the
various reputations of stakeholders in the design of reputation research, it is neces-
sary to come to terms with the concept of reputation first.This is also important as
there has been a lot of confusion and debate over the nature of corporate reputation
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in recent years. Various definitions exist, but by far the most widely cited and used
definition is the one provided by Charles Fombrun.According to Fombrun, reputa-
tion is ‘a perceptual representation of a company’s past actions and future prospects
that describe the firm’s overall appeal to all of its key constituents when compared
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to other leading rivals’. A few elements stand out in this definition. Reputation is
a perceptual construct and it involves multiple stakeholder groups who evaluate multiple char-
acteristics of the firm. Each of these elements is key to reputation, and for developing
a valid measurement instrument of it, so it is worth devoting a little bit of space to
discussing each of them further.
First of all, reputation is a perceptual construct.This may be plain obvious, but
when looking at the extensive literature on corporate reputations this does not appear
so. In the literature on the subject, reputation is not only seen as a collective percep-
tion of a firm in the minds of stakeholders, but the concept is often extended and
associated with organizational behaviour, assets and balance sheets of firms as well.
This link is often made as organizational assets (e.g. distinctive capabilities, brand
equity) are seen to be directly related to perceptions and evaluations of the firm by
stakeholders.The motive for doing so is the assumption that perceptions of stake-
holders in the aggregate are often relatively stable (e.g. customer evaluations of
brands like Coca-Cola), and that the associated market value (e.g. when customers