A surprise? Corporate reputations on the rise.

Corporate reputations on the riseWhat’s happening with the reputations of the leading U.S. corporations? Are we talking “bad rep” or “bum rap”?

Actually, it turns out that corporate reputations are on the rise; that’s according to findings from the 2011 Reputation Quotient® Survey conducted by market research firm Harris Interactive.

Each year since 1999, Harris has measured the reputations of the 60 “most visible” corporations in the United States. The 2011 survey, fielded in January and February, included ~30,000 Americans who are part of Harris’ online panel database. Respondents rated the companies on 20 attributes that comprise what Harris deems the overall “reputation quotient” (RQ).

The 2011 survey contained 54 “most visible” companies that were also part of the 2010 survey. Of those, 18 of the firms showed significant RQ increases compared to only two with declines.

The 20 attributes in the Harris survey are then grouped into six larger categories that are known to influence reputation and consumer behavior:

 Products and services
 Financial performance
 Emotional appeal
 Vision and leadership
 Workplace environment
 Social responsibility

Each of the ten top-rated companies in the 2011 survey achieved between an 81 and 84 RQ score in corporate reputation. (Any RQ score over 80 is considered “excellent” in the Harris study). In cescending order of score, these top-ranked corporations were:

 Google
 Johnson & Johnson
 3M Company
 Berkshire Hathaway
 Apple
 Intel Corporation
 Kraft Foods
 Amazon.com
 Disney Company
 General Mills

At the other end of the scale, the ten companies with the lowest ratings among the 60 included on the survey were:

 Delta Airlines (61 RQ score)
 JPMorgan Chase (61)
 ExxonMobil (61)
 General Motors (60)
 Bank of America (59)
 Chrysler (58)
 Citigroup (57)
 Goldman Sachs (54)
 BP (50)
 AIG (48)

Clearly, BP and AIG haven’t escaped their bottom-of-the-barrel ratings – and probably won’t anytime soon.

What about certain industries in general? The Harris research reveals that the technology segment is perceived most positively, with ~75% of respondents giving that sector a positive rating.

The next most popular segment – retail – had ~57% of respondents giving it a positive rating.

For the auto industry, the big news is not that it’s held in high regard (it’s not) … but that its ratings jumped 15 percentage points between 2010 and 2011. That’s the largest one-year jump recorded for any industry in any year since the Harris RQ Survey began.

What industries are bouncing along the bottom? Predictably, it’s financial services firms and oil companies.

But the news from this survey is, on balance, quite positive. In fact, Harris found that there were actually more individual companies rated “excellent” than has ever been recorded in the history of the survey. Considering the sorry state of the economy and how badly many brands have been battered, that result is nothing short of amazing

Insurance Fraud: The $80-billion Elephant in the Room

Insurance FraudIn all the debating about health insurance over the past two years, issues of consumer access and allowing pre-existing conditions have been at the forefront of the discussion.

One aspect that’s been much less reported is the issue of insurance fraud. Recently, I read some eye-popping statistics from the Coalition Against Insurance Fraud (CAIF). This not-for-profit organization estimates that the level of annual insurance fraud amounts to the equivalent of ~$950 for each household in the United States.

Moreover, the Insurance Information Institute estimates that fraud accounts for ~10% of the losses in the property and casualty insurance segments, while the National Health Care Anti-Fraud Association reports that ~3% of the U.S. health care industry’s expenditures are due to fraudulent activities.

So we’re not talking chump change.

Insurance fraud to the tune of $80 billion per year doesn’t happen just because of a few bad apples out there. What’s happening is far more serious than that. Indeed, there are highly organized fraud rings operating throughout the country engaging in everything from staging dangerous accidents to setting up bogus medical services.

The problem goes beyond merely the added cost being borne by consumers. CAIF contends that lives can be endangered, too, due to staged auto accidents, arson incidences, and “medical procedures” being performed by phony physicians.

Is it any wonder that insurance companies like GEICO have well-staffed special investigations units devoted to ferreting out illegal insurance activities wherever they can find them.

Insurance fraud has surely been a problem since the dawn of time, because at its heart is the opportunity for financial profit. In response, a plethora of national and state laws aimed at controlling fraudulent activities have been on the books for years (although surprisingly, insurance fraud is a crime in just 48 of the 50 states – what is it about Virginia and Oregon, I wonder?). Most states maintain their own fraud bureaus as well.

But like so much else the government tries to control or influence, all of these earnest efforts to stem fraudulent activities don’t seem to be adding up to much or getting us closer to a fraud-free world.

Now here’s an idea: Let’s pass some more anti-fraud laws!