CEO Concerns About Internet's Impact On Corporate Reputation Not Translating Into Action.

Business Editors

NEW YORK--(BUSINESS WIRE)--March 6, 2000

Only 11 Percent of Corporate Chiefs Regularly Check the Internet

to Find Out What Is Being Said About Their Companies

Corporate CEOs are acknowledging the Internet's impact on their corporate reputation, according to an annual survey conducted by Yankelovich Partners on behalf of the global public relations firm, Hill and Knowlton, Inc. and Chief Executive magazine. Yet, less than half of the almost 600 chief executive officers and senior managers questioned have a strategy for managing Internet communications as it relates to corporate image.

The survey also uncovered many other discrepancies between CEO concerns and action plans. For example, while more than 60 percent of respondents were very concerned or somewhat concerned about negative information on their companies in cyberspace, only 11 percent actually monitor the Internet regularly to keep abreast of what is being said.

"We would characterize these findings as a great deal of concern, but very little action," said Tom Hoog, president and chief executive officer of Hill and Knowlton U.S.A. "We expect at some point, this level of concern will translate into a higher percentage of companies developing programs to more effectively manage Internet communications."

Yankelovich Partners, on behalf of Hill and Knowlton and Chief Executive, conducted the Corporate Reputation Watch survey of the magazine's subscribers during the fall of 1999. The Hill and Knowlton/Chief Executive survey is one of the largest surveys of CEO attitudes about corporate reputation available today.

CEO concerns about the Internet focused primarily on unhappy customers venting their dissatisfaction online. Of the respondents, 40 percent were worried about unhappy customers criticizing their businesses on the Internet while approximately a quarter of those surveyed were concerned about both ex-employees and current employees using the Internet to criticize their companies. Another quarter of those surveyed were concerned about current employees using internal email to register complaints about their employers.

Criticism of their own web sites was fairly high among CEOs, with 64 percent saying they could be doing a better job enhancing their company's reputation. Eleven percent said they didn't use their web sites to enhance corporate reputation and 15 percent admitted to not having a web site at all. Only 9 percent claimed they were maximizing the value of their web sites.

CEO Internet usage is high, with as many as 80 percent of the senior managers saying they have used the Internet at work. On the average, the survey respondents spend around six hours a week on the Internet, but CEOs of larger companies spend slightly more time online (6.12 hours on the average).

"Despite their increasing familiarity with the Internet, and its demonstrable impact on reputation, CEOs seem to be doing surprisingly little about it," says J.P. Donlon, editor-in-chief of Chief Executive magazine. "They may fret about what Internet users may say, but only 11 percent say their companies monitor the Internet on a regular basis."

However, while the Internet plays a large part in how they do business, the CEOs are divided on whether it has an impact on their company's reputation. Fifty percent of CEOs believe that the Internet does not affect corporate reputation, while forty-six percent of companies surveyed said the Internet has had a positive impact on how their corporations are viewed.

"Overall, the number of CEOs measuring corporate reputation nearly doubled this year according to our survey, from 19 percent to 37 percent," said Harlan Teller, executive managing director of H&K's U.S. Corporate Practice. "These numbers reflect the growing interest in assessing corporate image and establishing a reputation benchmark. With the interest peaking, it's now time for these companies to develop a sound strategy for managing their reputations."

Chief Executive magazine (www.chiefexecutive.net) is a monthly journal of international business written by, and about CEOs. The New York City-based publication seeks to alert them to the views and valuable insights of other chief executives, in the belief that a knowledgeable CEO is the best consultant top management can have.

Yankelovich Partners Inc. is one of the world's premier marketing research and consulting organizations. Yankelovich, a strategic partner with Hill and Knowlton, has conducted some of the industry's most acclaimed and enduring works on consumer trends and their effects on business.

Established in 1927, Hill and Knowlton, Inc. (www.hillandknowlton.com) is a leading international public relations and public affairs firm based in New York, with 64 offices in 34 countries as well as an extensive associate network. The agency is part of WPP Group, plc, (NASDAQ: WPPGY) (www.wpp.com) one of the world's largest communications services groups. WPP Group provides services to local, multinational and global clients, including more than 300 of the Fortune Global 500.