Think tank highlights link between workers' rights and brand reputation

Organisations with a poor approach to working conditions and employee rights are likely to gain a negative reputation.

A recent survey carried out by the Reputation Institute has ranked the reputation of a number of well-known UK retailers. The results of this survey, which includes big name brands such as Ikea and Waitrose, has demonstrated that factors such as working conditions and employee rights can impact the way an organisation is perceived by the general public.

Online retail giant Amazon claimed top spot on the reputation index, ranking highly amongst participants for service, innovation, leadership and performance. Whereas Sports Direct had the ignominy of finishing bottom and being declared the UK’s ‘least reputable retailer’.

British high street regulars Boots and John Lewis rounded out the top three, finishing second and third respectively, with many of the higher ranking organisations benefiting from a ‘commitment to high ethical standards’ according to the survey.

Speaking on the matter, Stephan Hahn-Griffiths of the Reputation Institute revealed that there is “a clear link” between reputation and profits. Going on to discuss Sports Directs’ failings, he explained that recent news stories over working conditions has meant their “overall reputation has tumbled in the past year, alongside their profits”.

In light of this news, organisations should be aware that the way in which they treat staff goes a long way to framing public opinion and that poor working conditions could ultimately be bad for business. This is perhaps best characterised by HMRC’s repeated attempts to name and shame those who fall foul of national minimum wage (NMW) law, which regularly results in substantial negative media coverage that damages an organisation’s reputation.

In fact, it is likely due to public opinion that a number of smaller organisations are voluntarily choosing to publish their gender pay gap reports and modern slavery statements. Many have seen this as a way to promote themselves as a progressive and conscientious employer, hopefully boosting their reputation and profits in the process.

It is therefore important that organisations continue to abide by rules around pay and working time as these are emotive factors that regularly influence public opinion. Furthermore, organisations looking to improve their reputation should consider how a substantial employee benefits scheme could help improve employee relations and their ability to recruit and retain skilled individuals.

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