How companies can protect their reputation during a pandemic

A Financial Times Special report on Working from Home examined the business response to the Covid-19 lockdown, exploring in particular the steps that companies can take to protect their reputations. Alicia Clegg compared the very different approaches taken by leading high street names, looking not just at the way employers were treated, but also suppliers. While some businesses announced that staff would be kept on full pay, others declared that pay would be cut until the government furlough scheme kicked in. With pressure on businesses to do the right thing, there are no prizes for guessing where the U-turns came.

Similarly, those companies that supported supplier cash flow through early payments or refrained from cancelling orders or withholding payments to garment factories in countries such as Bangladesh came in for heavy criticism.

Investors as well as society increasingly judge such moves negatively. Leo Martin spoke to Alicia Clegg and is quoted in the article. As the popularity of environmental, social and governance (ESG) strategies continues to rise, being seen as a good employer is increasingly seen as an asset, he argues. “A lot of ESG indicators are really just proxies for good management”. This is supported by the mounting evidence to show that companies that behave responsibly deliver stronger, long-term results.

The article considered the actions of a range of companies, from garment factories failing to adhere to social distancing measures leading to further spreading of the virus to others asking staff to work despite being furloughed. The backlash resulting from widespread coverage of these actions is pushing those companies that want to be seen as responsible to focus more on fairness when making decisions that affect staff and suppliers.