Spring 2010
“ Issues Affecting Reputation Management and Strategic Communications”
Along Came Twitter: Reputation in the Digital Age
R
eputation is a primary concern for
ily Time
most businesses. In this era of citi-
s Messenger and listservs. Most companies had
a
zen journalism and instantaneous
e D
information, companies know that while the
Th
slightest misstep might not immediately land
them on the front page, it certainly could
ignite a firestorm of tweets and blog posts.
But that wasn’t always the case. Think back 10
years ago. The 24-hour news cycle was in
effect. Cell phones were nowhere near as
prolific as they are today, and texting was
unheard of. Twitter, Facebook and MySpace?
The closest we had were AOL Instant
THE BEGINING OF THE END OR THE END OF THE BEGINING?
To paraphrase Churchill, was 2010 “the beginning of the end or the end
of the beginning” of trust in the U.S.? Simply put, do we trust in our
institutions, leaders and society more or less as we begin this new decade?
Reputation is the composite record of people’s actions, deeds, values and
character as well as words—good or bad. Society demands that its lead-
ers and organizations represent the truth and that they be genuine, trans-
parent and willing to do what is right.
In this context, how do you account for the tragedy of 9/11/2001?
This date marked with notoriety the early stages of a decade of great
challenge for the U.S. The country came of age in the first months of the
new century. Americans wrestled with the reputation of their country in
the eyes of the rest of the world. We could not reconcile the fact that any
faction no matter how misguided or fanatical, could hate so much. We
still can’t fathom how a clash of culture and religion could prompt some-
one to crash planes full of innocent people into office towers filled with
those who likewise did no harm. We are now dealing with this misguided
aggression with military force in far-off lands, and it remains uncertain
that the sword will prevail when an olive branch may have a more lasting
effect.
It is said we learn more from our successes than our failures. Who can
forget the heroic event of January 15, 2009, when a plane safely landed
on the Hudson River with minimal injury to the grateful passengers and
crew. The captain said he was just doing what he was trained to do.
Understatement may be the hallmark of real heroes. They are just doing
their duty. It all comes down to trust: trust in our institutions, trust in
Tribute to Scott Emberley on page 5
vol.10 no.
Web sites, but they were nothing like what we
expect now – just a few static pages describing
what the organization did and where to find it.
The lack of a robust online world 10 years
ago meant companies did not have to be as
vigilant in guarding their reputations. Print
newspapers, magazines and the evening news
were the main sources of information; so as
long as a company was able to stay ahead of
the 24-hour news cycle, it could ensure crises
and issues were averted.
DIGITAL REPUTATION – CONTINUED ON PAGE 2
our society and trust in humanity that we will do the right thing when
we are called. We will also aim to do the right thing in our everyday lives
as we go about the business of life. These two events, the tragedy of the
World Trade Center and the heroic triumph of Flight 1549, bookend the
decade.
But lots of good things happened in between.
Heroic acts were not limited to humans in this first decade. I also recall the
beauty and wonder of one of the greatest race horses of all time, the
mighty Barbaro. He gave his very last breath for racing. I recall the victory
of our new president, the first black man to hold this position, who was
sworn in before a nation founded on the backs of slaves and humble immi-
grants. I recall also the boldness of our now deceased Massachusetts sen-
ator, whose last act championed the plight of millions of Americans with-
out health care. With the passage of this historic legislation, Kennedy’s
reputation for greatness is further solidified. I also see us gradually rising
from the throes of the “Great Recession” of 2009. So we do have reasons
to believe that trust is alive and well as we set off on this journey into the
next decade. It is always our choice. Please read on…
President and CEO
Morrissey & Company
I invite you to join the conversation and share your thoughts and ideas about safeguarding
an organization's reputation. Please join me on my Reputation Excellence blog –
http://blog.morrisseyco.com.
DIGITAL REPUTATION – CONTINUED FROM PAGE 1
For example, in October 2000 a company called Massey Energy Company
spilled an estimated 306 million gallons of coal sludge at its facility near Inez,
Ky., sending almost 250 million gallons into the Tug Fork River and two of its
tributaries. Although news of the Massey spill was certainly reported in local
media and energy and environment publications, the Internet chatter was min-
imal and, as such, the story was not covered on a national level. How could it
be otherwise? In the year 2000, blogs were still more Web log than information
source and Twitter was six years away from its launch.
But much has changed in the last decade. Print and television reporters are no
longer breaking stories; they are reporting on stories broken via non-traditional
media. Do you know who originally reported that Michael Jackson died?
TMZ.com. And the first murmurs of a plane landing in the Hudson River were
reported on Twitter.
According to a recent survey of journalists by George Washington University
and Cision, more than half of reporters surveyed say social media is important
or somewhat important to the development of the articles they write, and
almost 90 percent rely on blogs for their research.
This past January, Scott Brown, a state senator known more for his “American
Idol” contestant daughter than his legislative prowess, shocked the opposition
and captured national attention when he defeated Martha Coakley, a high-rank-
ing Democrat with strong name recognition. Brown took a page from the
Obama campaign and embraced social media to mobilize his supporters.
When Buzzwords Go Green
T H E PA S T A N D F U T U R E R E P U TAT I O N O F S U S TA I N A B I L I T Y
In a society obsessed with “the next big thing,” buzzwords are the litmus
test for what’s coming up and what’s burning out. Over the past decade,
we’ve watched buzzwords come and go the way of parachute pants and
pagers. But when a buzzword is tied to a cause, rather than just empty
words, will it become more than just a short-lived trend? Will corporate
America’s new favorite word – sustainability – evolve from a buzzword
to brick and mortar, or will extreme greenwashing, i.e. the use of
“green”on everything, dilute its importance?
Ten years ago, sustainability meant little more than its reference book
definition: “of, relating to, or being a method of harvesting or using a
resource so that the resource is not depleted or permanently damaged.”
Over the past decade, marketing-crazed campaigners have slapped green
and sustainable language on everything possible, pushing the sustainabil-
ity cause to the disingenuous edge. Savvy marketing campaigns for
low-energy light bulbs, paper-free workplaces and renewable energy have
preyed upon the general publics’ emotional ties to Mother Earth.
Sustainability has evolved from a concern of the few to a boardroom
priority for politicians, investors, consumers and businesses around the
world. But will sustainability’s lasting reputation hold fast to a more
eco-friendly society, or will our obsession with all things cheaper and
faster undermine those who are loyal to going green?
For centuries, international corporations have asked themselves one
essential question: “Will this make money?” At the end of the day, the
bottom line is the only line. However, in the last decade, sustainability
and its increasingly well-received reputation have influenced the way
companies make decisions about what will lead to profit in the long run
pg.
2
Brown’s team employed YouTube, Facebook, iPhone apps, Twitter and text mes-
saging to spread his message and spur supporters to action. The tactics worked.
Brown was able to raise $1.3 million in a single day, and his videos on YouTube
were viewed more than 500,000 times in the final month of the
election.
And as people become more comfortable with social media, more and more
organizations are embracing these platforms – in some cases using them in lieu
of traditional communications methods. For example, e.l.f., a low-cost cosmet-
ics brand, eschews traditional advertising in favor of social media. The strategy
fits in with the company’s overall reputation as an innovative organization that
keeps overhead low in order to provide high-quality products at low price
points. So far, the strategy is working for the young company. Sales are high,
CMO Ted Rubin has more than 20,000 followers on Twitter and the makeup
has received glowing reviews in many widely-read women’s magazines, including
O: The Oprah Magazine, Allure and Glamour.
As our communications platforms continue to evolve, so must our understand-
ing of the value of a good reputation. No longer can corporations rely on
traditional media relations and stock prices to buoy their reputations. An
organization must consider the messages conveyed by its every action and facet
and constantly monitor and adjust to ensure the best possible reputation.
~April Wildermuth
– a profit no longer merely defined by green (as in money). In the last
few years, several organizations have committed to long-term investments
in green technology that resulted in savings beneficial to both the earth
and the budget.
In a recent New York Times article, Danish shipping giant Maersk detailed
its commitment to sustainability. The shipping industry – one of only
two industries completely unregulated by the Kyoto Protocol – is
responsible for three percent of the world’s global carbon dioxide
emissions, which have grown eightfold between 1985 and 2007. Maersk
recently hired a director of environmental sustainability, a position
unheard of 10 years ago, and is “seized on a sales pitch that may startle
some hard-driving corporate customers: Slow is better,” according to The
New York Times. By reducing speeds, Maersk maximizes its fuel efficiency
through a reduction in drag and friction; however, it is entertaining the
idea of variable rates for those customers who can’t wait an extra week
for merchandise.
The future of sustainability and its reputation is shaky. While Abu
Dhabi is planning to build Masdar City, a zero carbon city of 50,000
people, China is growing at an astonishing rate and has little (if any)
production regulation. In fact, the Asian Development Bank believes that
by 2027 Asian cities will produce more than half of the world’s green-
house gases and will grow their populations by an estimated 1.8 billion
people. I believe the reputation of sustainability will either change
dramatically or a new buzzword with a different impact will evolve.
Could “resilience” be next?
~ Shannon Mullen
 Reputation in the Age of Search

ype the name of one of America’s largest cable companies followed by Reputation management in the age of search is no longer a matter of simply

T the words “customer service” into Google and get a truly horrifying
result. Nine of the top 20 Google results are either hate sites or arti-
cles about angry customers ranting about the company’s shoddy customer care.
This company is now on a major campaign to turn around customer percep-
tion, having learned the hard way that in the age of search, its reputation isn’t
its own any more.
Not long ago, a business or institution could manage its reputation with a coor-
dinated campaign of press releases and media relations. Customers were
largely deaf to the opinions of others like them, and the media
had no means to test the claims coming out of corporate.
No more. Today, we are all the media. We use our
online megaphones to blast our experiences and
opinions to a global audience. While the result- In the age of
ing cacophony can be difficult to penetrate,
patterns and leaders emerge from the din.
search, people no
The media increasingly listen to these
voices because they better represent the
longer take their
papering the walls with press releases. Reputations need to be backed by qual-
ity products and attentive customer care. In the age of search, people no longer
take their complaints to the customer service line; they go straight to the Web.
Woe befalls the company that doesn’t listen.
The good news is that these tools are available to everyone, and brands can use
them to burnish the good work that they do. Last October, a blogger com-
plained that employees of the Transportation Security Administration had sep-
arated her from her baby while administering a security check at the
Atlanta airport. The TSA responded quickly. It retrieved secu-
rity camera videos of the incident and posted them on
its blog. The videos clearly showed that TSA
employees followed procedures and at no point
separated mother from child. The evidence
clearly refuted the blogger's claims and gen-
erated favorable publicity for the TSA. In
the online free-for-all that is social
media, you need to fight fire with fire.

truth about the company than missives
from public relations. Influence has under-
gone an inversion. Reputations today are
built from the ground up and magnified by
attentive media.
complaints to Reputation management is consider-
the customer ably more complex today than it was a
few years ago, but the payoff is worth
service line; the trouble. Media relations isn't
enough. A business or organization

Search engines are the great equalizer. Google

they go straight
doesn't care if information comes from The New
York Times or an individual blogger as long as its
to the Web.
importance is validated by links from other sources.
People conducted 131 billion searches worldwide in
December 2009, according to Comscore. Each results page
reflected the collective validation of a global network of opinion.
And this is just the beginning. A new Google innovation called Sidewiki enables
visitors to a Web site to log their opinions and experiences for viewing by any
other visitor. In effect, customers can now co-opt a brand's own online presence
on its own Web site. Opinion aggregators like Yelp, Epinions and Kaboodle
harness the collective intelligence of the crowd and deliver advice on what to
buy – and what to avoid.
needs to reach out to opinion leaders,
magnify the voice of fans and respond
quickly to address criticism. The good news
is that a reputation that is burnished by the
opinions of peers is considerably more powerful
than one that is supported only by press releases. Small
companies with great products and excellent customer
service can leverage word-of-mouth awareness to quickly communi-
cate their value.
The process starts with searching on your own brand and putting tools in place
to monitor topics that matter to you. Identify the positive and negative influ-
encers and reach out to both. Invite your fans to develop closer relationships
with you and address your critics quickly and decisively. Many will become your
greatest supporters as a result. Your goal should be for the first page of search
results on your brand, your products and your market to reflect the opinion you
want to cultivate. Work from both the top and the bottom of the pyramid.
Today, more than ever, the two sides influence each other.
~ Paul Gillin

pg.
3
 The Nonprofit Reputation
A charity or nonprofit organization’s reputation is its lifeblood. Funding
and the ability to do business and attract top management and board
members – essentially all of the things that allow a nonprofit to
deliver services and fulfill its mission – hinge on the organization’s reputation.
One can argue that the inherent nature of a nonprofit’s responsibility to do
good holds it up to a higher standard of conduct and ethics than the for-profit
sector. This makes it harder, but also more important, for a nonprofit to
protect and advance its reputation.
Nothing has impacted the charitable sector’s collective reputation in such a
significant and positive way as the Internet. It represents a powerful tool for
nonprofits to build their reputations and engage and build a donor base by shar-
ing information about programs and services faster and more cost-effectively
than in the past.
Take Kiva, a nonprofit that allows people to make zero-interest “microfinance”
loans over the Internet to needy entrepreneurs in developing countries.
Launched in fall 2005, the organization had drawn 89,600 lenders who had
lent $10 million by summer 2007. The charity did this in part by being open
and transparent online. With profiles on Facebook and other sites, it built a vir-
tual following that generated donors and supporters and, in the spirit of social
media, embraced the site Kivafriends.org, developed and run by an enthusiastic
supporter looking to spread the word about Kiva on his own. The nonprofit’s
reputation flourished, catching the eye of celebrities like Oprah Winfrey and
New York Times columnist Nicholas D. Kristof.
The Humane Society of the United States is another example of a nonprofit
using the Internet to increase transparency, awareness and its reputational value.
The organization has tapped into every form of social networking to build a
robust member and donor base, effectively move their advocacy issues forward,
and educate the public about animal-related issues. At times a lightning rod for
criticism from parties targeted by its advocacy and ballot initiatives, the organi-
zation also uses these tools and the CEO’s blog to directly address false or mis-
leading claims made about its positions, setting the record straight and protect-
ing its reputation.
pg.
4
.org
These organizations harnessed the power of the Internet to advance their
reputations – something that would not have been possible just 10 years ago.
However, there is a flipside.
This summer Kiva announced that it would allow users to make loans to bor-
rowers in the United States. This policy change led to the formation of
"Unhappy Kiva Lenders," a group of users who claimed that adding U.S.
borrowers to the platform undermined what made Kiva special. And this fall,
many bloggers debated what some have called Kiva's misleading marketing (i.e.,
a Kiva user does not make the loan directly to a specific borrower; rather, the
funds are sent to a microfinance institution, which actually makes and adminis-
ters the loan). This debate then bounced to the mainstream media, leaving Kiva
defending itself and its reputation.
Even more recently, FastCompany expert blogger Alice Korngold broke the news
that Wyclef Jean, singer and founder of the Yéle Haiti Foundation, committed
acts of impropriety. Yéle Haiti was criticized by the Better Business Bureau
after finding that three years of IRS filings were submitted all at once, three out
of the five board members were involved in Jean's personal and business
dealings and funds for the foundation seemed to be intertwined with Jean's
business.
According to Korngold, “Although Jean has defended himself, and ultimately
there may be no finding of impropriety, there has been harm to his foundation
and to his efforts… His nonprofit has taken a major reputational hit, and peo-
ple might stop making financial contributions to the Wyclef Jean Foundation,
also known as Yéle Haiti, for Haiti relief efforts.”
The most important lesson here is that nonprofits and their boards of direc-
tors need to ensure they implement sound operational practices and are not
leaving themselves open to public criticism and loss of credibility by failing to
comply with regulations.
N O N P R O F I T R E P U TAT I O N – C O N T I N U E D O N PA G E 5
N O N P R O F I T R E P U TAT I O N – C O N T I N U E D F R O M PA G E 4
In the end, what may help Jean’s charity’s reputation
is the support and goodwill Yéle Haiti has built
over the years. Some groups that have worked
with Yéle’s Haitian arm praise it, including the
World Food Program, affiliated with the United
Nations. The group indicated it could not func-
tion in some parts of Haiti without Wyclef Jean’s
support, a sentiment echoed by the Pan American
Development Foundation, a nonprofit affiliated
with the Organization of American States.
In the past 10 years, the Internet has dramatically
changed the landscape for nonprofit organiza-
tions, giving them the ability to build their
reputations while at the same time leaving them
open to increased reputational risk.
While some of the tools have changed over the
years, there are still some basic rules nonprofits
should follow to manage their reputational risk.
Transparency
In this age of instant gratification, donors want
information about charities they support and are
more likely to give if provided with it. “Portraits
of Donors,” a study by the Center on
Philanthropy at Indiana University, asked donors
with a net worth of more than $1 million or an
annual income of more than $200,000 what
would cause them to donate more. According to
the findings, 31.1 percent said “if they under-
stood the goals of the nonprofits,” 34.7 percent
stated “if they had more access to research,” and
58.3 percent indicated “if they were able to deter-
mine the impact of their gifts.”
But any organization that pledges itself to trans-
parency and user conversations without a full
commitment is likely to find those tools
turned against it. Some analysts pointed to Kiva’s
transparency as the reason it got into hot water
over its marketing practices; however,
one can argue that the only reason it rebounded so
well is because it used those very same practices to
reverse the backlash and garner further support.
Following the controversy, Kiva publicly changed
its marketing and posted news of the change on its
Web site, blogged about the issue and conducted
interviews with high visibility media. A Google
search of “Kiva” today generates mostly favorable
news. The transparency principle on which the
company was founded fostered goodwill, which
led defenders to jump to its aid on Twitter and
other social media networks and encouraged the
public and media to give it a second chance.
Ensure compliance
In Yéle’s case, the mere appearance of improprieties
was deeply troubling to donors. The most impor-
tant lesson for nonprofits and their boards is to be
vigilant in following the rules and consider appear-
ances. Make sure your board is educated about its
roles and responsibilities. According to The Nonprofit
Times:
“Despite extensive coverage in philanthropy media
and the volumes written about governance, finan-
cial management, transparency and accountability,
many nonprofit leaders still aren’t getting the mes-
sage. Nonprofit board members, managers and
staff who do not quickly educate themselves and
fully comply do so at a great personal risk to their
wallets and their reputations, and put their organi-
A Reputation
zations in jeopardy.” For Being Happy
Board members are reputational ambassadors for
an organization. Beyond making connections and SCOTT EMBERLEY
representing the group in the community, a board J U LY 2 1 , 1 9 7 1 – M A R C H 2 4 , 2 0 1 0
member is responsible for fiscal oversight and for
understanding compliance issues. When in doubt, For those of our
bring in a lawyer or ask a lawyer to sit on the
board. readers who knew Scott
Emberley, our good
Nurture and monitor your
reputation friend and colleague who
There are a number of issues that can befall a recently passed away, you
nonprofit organization and hurt its reputation, know the loss will be carried
from financial improprieties to management
changes to volunteer misconduct. Relatively with us always. Scott embodied every-
minor complaints may build over time until there thing that is good in people – both great
is a perception that a bigger problem exists and
the community’s perception of the organization strengths and human weaknesses. Scott
changes. Nonprofits must have a proactive repu- taught us all how to enjoy life.
tation plan in place that guides the activities to
help build and maintain its reputation as well as
identifies reputational risks and means for He loved golf, music, work and his
protecting against those risks. faraway home in Newfoundland, but
In addition, the organization should monitor its mostly his life with his family. He was
reputation and be constantly aware of how it is interested in what others were doing
viewed to manage any gap between reality and rep- and interested in helping others. There
utation. If an organization is committed to con-
ducting regular checks of its reputation, it will be was rarely a day these past 10 years he
aware when there are issues that require attention. was with us at Morrissey & Company
As soon-to-be published research in the that he did not get someone to smile
forthcoming Journal of Consumer Research finds, and put aside the challenges of life.
consumers tend to apply stereotypical definitions
to nonprofits, thinking of them as caring organi-
zations, but ones that are not particularly Scott also showed us all how to pass
financially competent or able to provide high- from this world with honor and dignity,
quality goods or services. One of the researchers,
Professor Cassie Mogilner of Wharton, states, never complaining or feeling sorry for
“For nonprofit firms stuck with the stereotype of himself as the cancer took his body
being warm but not particularly competent, away. But we know Scott won this battle
anything that boosts their perceived competence
will help them survive in the marketplace.” for immortality. The sickness took only
his life; his spirit lives with each and
Nonprofit organizations generally do good and every one he touched.
important work, and serving as a board member is ~ Peter A. Morrissey
an important, valuable contribution. However,
nonprofit leaders and directors alike must remem-
ber that protecting a reputation is just as impor-
tant as earning it, and in this digital age, the tools
that can help make you, can also break you. For
more on the topic of nonprofit organizations and
reputation, visit http://www.morrisseyco.com/per-
spective/communications-mvr.asp.
~Lauren DiGeronimo
pg.
5
Morrissey & Company
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Please visit our Web-site at: http://www.morrisseyco.com and RepEx Blog: http://blog.morrisseyco.com/
The Mount Vernon Report™ is published and copyrighted 2010 by Morrissey & Company, an independent Reputation Communications firm headquartered at 6 Edgerly Place, Boston, MA 02116. Permission to copy and distribute is granted, provided that
full attribution is given to Morrissey & Company. Further commentary or response to any of the topics discussed in this issue is welcome and should be directed to 617-523-4141 or via e-mail to peter@morrisseyco.com.
Printed on recycled paper. In an effort to conserve natural resources we have altered the format of The Mount Vernon Report to omit the use of an envelope.

Reputation Advisor
L E S S O N S L E A R N E D : T I P S T O E N H A N C E Y O U R C O M PA N Y ’ S R E P U TAT I O N F O R T H E F U T U R E

here are many lessons we can learn from the past decade’s in addressing your customer’s issue before the word spreads. Remember

T trials and tribulations. No debate on reputation communications

would be complete without discussing Enron or Martha Stewart;
these scandals have created new benchmarks for illustrating how to
to be very polite when communicating your point of view in front of any
audience – kindness usually prevails. Answering negative remarks mod-
estly can be a great way of turning a bad situation into a positive one. If
destroy corporate reputations. In 2001, Enron added insult to injury someone pays your company a compliment, write them a handwritten
when it admitted to overstating its profits by about $600 million. note to show your gratitude. Communication is vital in building trust
In 2003, domestic diva Martha Stewart was charged on nine with your customers.
federal counts of insider trading when she avoided a loss of $45,673 by
selling all 3,928 shares of her ImClone Systems stock after receiving Set up social media networks. Being proactive on Twitter,
material, nonpublic information from her broker at Merrill Lynch. LinkedIn and Facebook will help to maintain your company’s online
The day following her sale, the stock value of ImClone Systems reputation. When participating in these social media networks,
dropped by 16 percent. make sure you engage and interact and monitor comments for
both positive and negative remarks. In addition to the
With the bad, comes the good. Over the past decade,
NE O
popular social media outlets, a unique company blog
General Electric, under the leadership of CEO Jack CHARACTERISTIC can be extremely effective in promoting your busi-
Welch, has proven one of the most valuable ness, especially when you invite your customers
business brands in the world. During his OF THE GREAT CEOS OF to comment. It is also important for your
reign, Welch made a name for himself as company bloggers to comment on other
the best manager in corporate THE NEXT DECADE WILL BE industry blogs. For example, there are
America, creating a new organization THE DEGREE TO WHICH THEY BUILD several companies that maintain
that pushed managers to become more active blogs and communicate with
productive and generating billions in AND USE THEIR CORPORATE including Johnson & Johnson
wealth for shareholders along the way. (http://jnjbtw.com/) and UPS (http:
REPUTATION TO THEIR //blog.ups.com).
One of the most important rules of reputation ADVANTAGE.
communications is the need for constant vigilance. Be visible both in person and online. Online
Today, companies are exposed to unprecedented scrutiny visibility is crucial to all businesses. Some opportunities
through the Internet and 24-hour all-news television channels. include: hosting a webinar to show your company’s strengths
Business is truly global, and information, especially slander, trav- and areas of proficiency. Senior management should take advan-
els fast so it is vital to respond in a timely fashion. Not addressing tage of speaking opportunities and conferences that are appropriate
an issue immediately can cause further damage to one’s reputation and for your business. Getting employees involved with volunteer opportu-
credibility. nities within the community can help to enhance your public and corpo-
rate image, improve relations with the surrounding community and have
Below are some suggestions to enhance your company’s reputation: a positive impact on employee morale.

Respond to customers immediately. Being open and responsive ~ Liza Stewart

to your customers is an important part of creating a positive impression
and managing your company’s reputation. If someone asks you a ques-
tion, respond within 24 hours. If someone reports a complaint, be quick

pg.
6