Components and Parameters of Corporate Reputation — An Empirical Study

Abstract

A wide variety of scientific and semi-scientific publications state that (amorphous) constructs like corporate reputation may cause sustainable profits. The reason for their interest in reputation is that increasing competition in a globalized economy promotes the identification of drivers of sustainable competitive advantages in the field of intangible assets, too. Therefore, in this paper, we describe the state of the art in defining and measuring corporate reputation. Literature review, theory-based conceptualization, and expert interviews allow us to develop and test an item battery, resulting in a new measurement approach. Our results show that fitting a structural model is much easier if we do not follow American literature, where reputation is supposed to be one-dimensional, but instead split corporate reputation into two dimensions, a cognitive component we call competence and an affective one we call sympathy. We show that performance aspects drive competence but dampen sympathy, whereas responsibility items have positive impact on sympathy and negative impact on competence.