Corporate Reputation of a Firm selling potentially harmful Products in South Africa

Abstract

Corporate reputation has evolved into a key intangible asset that provides firms with both a licence to operate in society and a sustainable competitive advantage over competitors. Reputation has become even more crucial to global firms in light of the many recent corporate scandals that have seen the demise of firms previously thought indestructible. The purpose of this research was to ascertain the importance of reputation to a firm that sells potentially harmful products in South Africa. This case study research focuses on the South African Breweries (SAB). A critical review of the literature revealed that global markets have changed towards demanding that firms act in an ethical manner at all times. Whilst there was ambiguity in terms of the exact definition of corporate reputation, the numerous advantages of positive corporate reputation was unquestionable. The literature, however, fails to address the importance of reputation to a firm selling a product like beer, which is potentially harmful when abused. Accordingly, this study attempts to address this by offering evidence as to the manner in which the South African Breweries views corporate reputation. In order to gauge employee perspectives on corporate reputation, twenty semi-structured, in-depth interviews were held with various staff members of SAB. The company enjoys the lion’s share of the beer market in South Africa but has come under increased criticism from stakeholders concerned with the many negative impacts alcohol abuse has on South African society. Together with this criticism, SAB is facing stiff competition from foreign beer producers hungry for a share of the South African beer market. The research findings indicate that corporate reputation is not a major concern to SAB. The employees interviewed indicated that whilst the organisation was aware of the need to manage its reputation in the country, the market share it enjoyed did not warrant dedicated focus to the management and improvement of its reputation. This study lays the foundation for further studies within the realm of the importance of corporate reputation to all firms in South Africa.