An Improved Reputation$-$Claire Makes a Decision

After reading all of the negative media coverage about the leak, Claire realized that, with no money available for big budget projects, the best she could do in the short term would be to emphasize that the company cared about the community it served.

The leak was an accident$-$the EPA found no evidence of shoddy maintenance practices$-$but the community had been directly impacted. Employees who lived in the community were embarrassed when confronted in the street by angry residents. They took pride in their work and took the loss of customers very personally. Falling sales also brought the threat of job cuts that damaged morale even more.

Claire chose to present a two$-$step plan to turn around the company's reputation:

A commitment to transparent communication. Mr$.$ Jones would write an open letter to the media acknowledging the errors of the leak and making a public commitment to working with the EPA inspectors and implementing whatever changes they want the company to make. Mr$.$ Jones would also write a second letter to employees acknowledging the issue and addressing their concerns about their community and their job security.

At the next shareholders' meeting $($in three months$),$ Mr$.$ Jones would, with Claire's help, propose a more proactive CSR strategy with a planned rollout of capital investments. The projects would be small at first$-$sponsoring highway cleanup outside the head office, allowing employees to spend one day per month volunteering in the community, and sponsoring a local community event. Over time, larger projects could be introduced, such as switching to hybrid or electric cars for the sales fleet or solar power for the office.

Q$)$ Do you think that if this company chooses to inflate the image of their corporate citizenship, it will help them regain their trust? Why or why not?