Bradford School of Management corporate reputation expert speaks on BBC Radio 4 World at One
A corporate reputation expert at the University of Bradford School of Management has been speaking on the BBC about the implications for multinational companies that the public is now likely to be given access to how much tax they pay.
Professor of Marketing, Stuart Roper, appeared on BBC Radio 4’s World at One programme today to discuss the news that the European Commission is to force large corporations operating in Europe to disclose profits earned and taxes paid in each of the EU’s 28 member states, as well as fiscal havens.
In the wake of the Panama Papers revelations, large companies trading in Europe, including subsidiaries of non-European businesses, would have to publish how much tax they pay outside the EU, including detailed country-by-country information on their finances in tax havens.
Presenter Martha Kearney asked Prof Roper whether the public being able to see how much (or how little) tax multinationals were paying would have any effect on their behaviour.
Prof Roper said it appeared that the current bad publicity some companies have had over their tax affairs appears not to have caused damage to their brand.
He cited recent examples of global corporations which had been in the media for its tax affairs, such as Google, which this year did a deal with the Treasury to pay a low percentage of tax on its earning.
He said according to the 2016 RepTrak survey the bad publicity had appeared to do Google no harm, with the corporation being ranked third in the world for highest corporate reputation. Apple, which has had similar publicity over its tax payments, is ranked tenth in the world for reputation.
Prof Roper said the view that these stories do damage to a corporate reputation has to be questioned.
However, Prof Roper said that the influence of negative stories about a corporation on the public can be increased the more the stories add up.
“What really matters is momentum,” he said. “If there is one bad news story they (the company) can probably ride it out, but if there were a number of bad news stories simultaneously – I think Tesco is a good example of this. Their reputation was damaged not just by one thing, but a group of stories. There was the horse meat scandal, the black hole in their finances and stories about customer service. It’s when the media attention continues from one reason to another.”
He added: “If it was just about tax I’m not quite sure customers would inconvenience themselves by, for example, dealing with someone else rather than dealing with, say, Amazon.”
You can listen to Prof Roper on BBC Radio 4's World at One on iPlayer. His interview starts at 12 minutes.