Investigating the True Effect of Corporate Reputation on Firm Performance Disentangling the Measurement Jungle

Abstract

Various scholars provide evidence for a positive relationship between corporate reputation (CR) and firm performance. Building on this effectiveness hypothesis this study compares empirically the most prominent measurements and rankings of CR. The applied methodologies of the identified rankings vary in three main areas: Surveyed stakeholder groups, number of dimensions, and method of data collection. This poses the question if these variations affect the performance implications of CR. Results indicate that comprehensively including the proposed dimensions of CR matters – in other words, the conceptualization of CR is key for understanding its performance implications. On the other hand, the operationalization (groups of respondents, method of data collection) seems to play a lesser role in demonstrating the CR-firm performance relationship. This implies that managers and academics should rather focus on the appropriate conceptualization and less so on the operationalization of CR