2009 Harris Interactive RQ Study finds decline in reputation of Pharmaceuticals

After hitting rock bottom during the height of greed, bailouts, and the economic crisis in 2008, the American public's perceptions of the reputation of corporate America seem to be bouncing back. This, according to the findings of the 2009 Harris Interactive RQ Study, which measures the reputations of the 60 Most Visible Companies in the U.S.

“In addition to the slightly more positive reputation environment, we see a very different overall view of how companies are being evaluated and perceived this year”

The percentage of Americans who see the state of reputation as "not good" or "terrible" decreased from 88% in 2008 to 81% in 2009. Perhaps even more telling, there was a 50% increase in the number of Americans who said that the state of reputation is "good", moving from 12% to 18%. This is the first positive improvement in four years.

Six companies received an RQ score over 80, which is considered to be an "Excellent" reputation, with Berkshire Hathaway taking the top spot from frequent top scorer Johnson & Johnson by less than 0.5 points. Rounding out the list of companies with excellent reputations are Google, 3M Company, SC Johnson, and Intel Corporation. SC Johnson appears on the list of the 60 most visible companies for the first time, with the 5^th highest RQ score this year and is the first company since Google in 2005 to debut in the top five.

"In addition to the slightly more positive reputation environment, we see a very different overall view of how companies are being evaluated and perceived this year," comments Robert Fronk, Senior Vice President, Global Practice Lead, Reputation Management at Harris Interactive. "In last year's study we saw companies that provided value and a sense of comfort getting strong overall reputation ratings. This year, we see overall corporate governance, performance and leadership driving positive reputation perceptions. Finding two holding companies, Berkshire Hathaway and SC Johnson, in the top five, is a visible reflection of this difference in focus."

9 of 10 Lowest Ranked Companies were Recipients of Government Bailout

At the other end of the spectrum, AIG moved up one spot, ceding the lowest rating to Freddie Mac, another first time company on the list of the 60 most visible. These two companies, along with Fannie Mae, received RQ scores below 50, which over the past eight years of this study, has been a very strong indicator of a lack of future viability for a company. Freddie Mac's score of 38.94 is the lowest recorded score since Enron's 30.05 in 2005.

Looking further at the bottom of the rankings, we find the nine lowest companies all have recently received government/bailout money or currently remain government supported, including another newcomer to the list, Goldman Sachs, who joins the most visible list with an RQ score of 51.36.

Ford as Bright Spot

One of the true bright spots in the study belongs to Ford, whose RQ score increased by 11.28 points from 2008, the largest single year improvement in the past nine years. Ford's score of 69.77 places it statistically in the category of companies with a "good" reputation, a tremendous accomplishment given its starting point and the state of the automotive industry.

"Ford's almost record-breaking leap in reputation, the second-largest in our study's 11-year history, was enabled by perceptions of their products and services finally catching up with the other positive indicators we have seen in the market over the past few years," says Harris' Robert Fronk. "This, combined with perceptions of a clear vision and strong leadership, really distinguishes Ford from one of the lowest-ranking industries and provides them with a competitive business advantage."

Reputation by Sector

At an industry level, Technology remains the highest rated industry, with a five-point increase from last year to a current 72% positive rating. The two largest reputation increases were in Retail and Automotive, both showing nine point increases. The only industry to show a decline in reputation was Pharmaceuticals, which displayed a two point decrease following a five point rise in 2008. Financial Services and Tobacco continue to hold the lowest industry rankings, however even Financial Services showed a five point increase from last year.

Following are some additional findings of interest:

• The top 10 companies on this year's list in order of ranking include: 1) Berkshire Hathaway; 2) Johnson & Johnson; 3) Google 4) 3M Company; 5) SC Johnson; 6) Intel Corporation; 7)Microsoft; 8) The Coca-Cola Company; 9) amazon.com; 10) General Mills. For a full list of the top 60 companies and other findings visit: www.harrisinteractive.com.
• The bottom 10 companies on this year's list in order of ranking include: 51.) Delta Airlines; 52) Bank of America; 53) JP Morgan Chase; 54) General Motors; 55) Chrysler; 56) Goldman Sachs; 57) Citigroup; 58) Fannie Mae; 59) AIG; 60) Freddie Mac.
• There are six reputational dimensions that the RQ survey focuses on that influence reputation and consumer behavior. Below are the six dimensions along with the five corporations that ranked highest within each:
  • Social Responsibility - Johnson & Johnson, Microsoft, SC Johnson, Lowe's, Whole Foods Market
  • Emotional Appeal - Johnson & Johnson, amazon.com, SC Johnson, Berkshire Hathaway, General Mills
  • Financial Performance - Berkshire Hathaway, Google, Microsoft, Disney, Coca-Cola
  • Products & Services - 3M Company, Intel Corporation, Google, Johnson & Johnson, SC Johnson
  • Vision & Leadership - Berkshire Hathaway, Google, Microsoft, Apple, Coca-Cola,
  • Workplace Environment - Google, Berkshire Hathaway, Microsoft, Johnson & Johnson, 3M Company