The 2015 U.S.Healthcare...
Transcript of The 2015 U.S.Healthcare...
REPUTATION LEADERS NETWORK
The 2015 U.S. Healthcare RepTrak®Reputation Leaders in U.S. Healthcare Industry
Part of the World’s Largest Study on Corporate Reputation
June 2015
1
REPUTATION LEADERS NETWORKAbout Reputation Institute
Reputation Institute is the world’s leading reputation-based research advisory firm, founded by Dr. Charles Fombrun and Dr. Cees van Riel in 1997.
Reputation Institute’s RepTrak®
Research is the worlds largest and highest quality normative reputation benchmark database.
• 7 Dimensions of Reputation• 10 Years of Data Indexed• 40 Countries Measured• 15 Stakeholder Groups• 3,000 Companies per Year• 6M Responses per Year
Our most prominent management tool is the RepTrak® model for analyzing the reputations of companies and institutions – best known via the Forbes-published Global RepTrak® 100, the world’s largest study of corporate reputations.
We enable leaders to make business decisions that build and protect reputation capital and
drive competitive advantage
Knowledge AdviceResearch
InsightStrategy
Activation
PublicationConferencesTraining
InformationAnalysis
Presentation
The world leader in Reputation Management research
c
2
REPUTATION LEADERS NETWORKWelcome to the US Healthcare RepTrak®
① Reputation Institute conducts the US Healthcare RepTrak® annually to measure the reputation of the most highly regarded healthcare companies in the United States
② It is part of the largest US reputation study, which has over 80,000 ratings collected during Q1 2015
③ Respondents are qualified at 2 tiers:• Familiarity: Respondent must be “somewhat” or “very” familiar • RepTrak® Pulse: 75% completion of pulse rating to be included
④ The results tell us:• Which healthcare companies are best regarded by consumers• What drives trust and support with consumers• How the top companies are living up to public expectations
3
REPUTATION LEADERS NETWORK
• About Reputation Institute
• How does Reputation Institute study corporate reputation?
• The 2015 US Healthcare RepTrak®
Agenda
4
REPUTATION LEADERS NETWORKWhy Measure Reputation?
The success of your company depends on getting people to support you, and:
… that ensures
• Consumers use your products
• Customers recommend you
• Your investors support you
• Policy-makers and regulators give you the benefit of the doubt
• Your employees are aligned and deliver on your strategy
Reputation is an emotional bond…
5
REPUTATION LEADERS NETWORKReputation Drives Support
The RepTrak® System measures a company’s ability to deliver on stakeholder expectations in the 7 key rational dimensions of Reputation:
1. Products / Services2. Innovation3. Workplace4. Governance5. Citizenship 6. Leadership 7. Financial Performance
A company that delivers on expectations in the 7 domains will earn
support from its stakeholders:
� Buy
� Work
� Invest
� Neighbor
� Benefit of Doubt
� Recommend
6
REPUTATION LEADERS NETWORKThe RepTrak® Model Summary
12 3
7
REPUTATION LEADERS NETWORK2015 US Industry Rankings
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
Highlights
Industry scores can help put
company scores in context, as
consumer perceptions about an
industry can have either a halo
effect or a damaging impact on their perceptions about an individual
company
• The Healthcare industry
improved in the last year, moving
from an average to a strong reputation.
• In 2015 the Healthcare industry’s
score places it on par with the 2nd
ranked Industrial industry
2015
1
2
3
4
5
6
7
8
Rank
9 76.49
73.34
71.54
71.22
69.88
69.51
68.46
67.29
66.13
65.04
Consumer
Industrial
Healthcare
Hospitality
Retail
Energy
Financial
Technology
Information & Media
All Pulse scores that differ by more than +/- 0.9 are significantly different at the 95% confidence level.
Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the Pulse score on a 0-100 scale).
The Healthcare Industry includes pharmaceuticals,
medical device and acute care companies
8
REPUTATION LEADERS NETWORK
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
2015
1
2
3
4
5
6
7
8
Rank
9
72.6810
80.00
Highlights
• All ten companies have strong
scores ; none are in the
excellent range
• 7 out of the 10 are
pharmaceutical companies,
and the rest are medical device companies
All Pulse scores that differ by more than +/- 3.1 are significantly different at the 95% confidence level.
Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the Pulse score on a 0-100 scale).
73.17
77.55
76.16
75.83
74.82
74.50
74.33
74.02
73.49
Who are the Top 10 in the U.S. Healthcare Industry?
9
REPUTATION LEADERS NETWORKRank Company 2015 RepTrak® Pulse Score
1 Shire Ltd. 77.552
Sanofi (former Sanofi-Aventis) 76.16
3 Bayer 75.834 Boehringer Ingelhiem 74.825 MEDITECH 74.506
BD (Becton, Dickinson and Company) 74.33
7 Perrigo 74.028 AbbVie 73.499 Roche 73.17
10 Boston Scientific 72.6811 Eli Lilly 72.0312 Novartis 71.4613 Takeda Pharmaceutical 71.0914 AmerisourceBergen 70.9515 Celgene 70.8316 Mylan 70.7917 Amgen 70.5218 Baxter International 70.5219 Gilead Sciences 70.2520 MSD (Merck Sharp & Dohme) 70.1521 Abbott Laboratories 70.0122 Bristol-Myers Squibb 69.8423 Genentech 69.8424 GlaxoSmithKline 69.7425 Medtronic 69.23
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
All Pulse scores that differ by more than +/- 3.1 are significantly different at the 95% confidence level.
Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the Pulse score on a 0-100 scale).
2015 US Healthcare RepTrak®: The 25 Most Reputable Healthcare Companies in the U.S.
10
REPUTATION LEADERS NETWORK
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
2015
1
2
3
4
5
6
7
8
Rank
9
71.0910
80.00
Highlights
• Shire, Sanofi and Bayer on par
based on their reputational
performance
All Pulse scores that differ by more than +/- 3.1 are significantly different at the 95% confidence level.
Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the Pulse score on a 0-100 scale).
71.46
77.55
76.16
75.83
74.82
74.02
73.49
73.17
72.03
Top 10 in the U.S. Healthcare Industry – Pharmaceuticals
11
REPUTATION LEADERS NETWORKWhat are the primary reputation drivers?
2015 US RepTrak Drivers
18.0%
13.4%
12.8%
14.0%
15.5%
13.1%
13.2%
• Product/Services: Offers high quality products and services
• Innovation: Is an innovative company -- it makes or sells innovative products or innovates in the way it does business
• Workplace: Is an appealing place to work -- it treats its employees well
• Governance: Is a responsibly-run company -- it behaves ethically and is open & transparent in its business dealings
• Citizenship: Is a good corporate citizen -- it supports good causes & protects the environment
• Leadership: Is a company with strong leadership -- it has visible leaders & is managed effectively
• Performance: Is a high-performance company -- it delivers good financial results
Factor Adjusted RegressionN = 43,600AdjR = 0.708
12
REPUTATION LEADERS NETWORKWhat are the primary reputation drivers?
2015 U.S. RepTrak® Drivers: All Industries
18.0%
13.4%
12.8%
14.0%
15.5%
13.1%
13.2%
15.7%
12.8%
13.0%
16.3%
16.7%
11.6%
14.0%
2015 U.S. RepTrak® Drivers: Healthcare Industry
13
REPUTATION LEADERS NETWORKAction AND communication are critical to convert neutral consumers
Note: % of public who is neutral or ‘not sure’ about company’s performance on that dimension
40.5%
52.5%
46.8%
50.6%
46.8%
45.3%
41.4%
Highlights
• Across the 7 dimensions of reputation, 40% to 53% of consumers are
uncertain what the companies are doing
• These consumers are crucial fence-sitters who can swing to the positive or to the negative based on whatever information they
receive
• The Corporate Social Responsibility (CSR) dimensions are both where
the percentage of fence-sitters is highest, as well as 2 of the top 3
most important reputation drivers
41.0%(Product)
48.4%(Enterprise)
14
REPUTATION LEADERS NETWORKPerformance in key dimensions : Governance and Citizenship
Highlights
• Shire’s “keep momming” campaign,
increasing awareness for ADHD
among young girls, has stressed the company’s relevance to society
• Shire espouses a unique business
model – a virtual, lean pharma
company that relies more on
outsourcing. As a result, the reputation-risky sides of pharma
company are less visible to the public,
while the reputation-rewarding
aspects (helping kids with ADHD,
targeting rare diseases that no one else fights) is very visible to the
public.
• * in industry rank
Healthcare IndustryGovernance Score: 70.40
77.92
+7.52
Healthcare IndustryCitizenship Score: 69.84
73.98
+4.14
Governance*
Citizenship*
Industry Rank
U.S. 100 Rank
1st
1st
31st
2nd
15.7%
16.3%16.7%
All Pulse scores that differ by more than +/- 6.2 are significantly different at the 95% confidence level.
Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the Pulse score on a 0-100 scale).
2nd
2nd
57th
1st
76.89
+6.49
78.33
+8.49
+6.2 (sig)
15
REPUTATION LEADERS NETWORK
2015 U.S. Healthcare Industry’s Reputation Drivers
1 3
18.0%
14.%13.5%
13.3%12.6%
15.4%
13.3% 1
Sanofi Driven By Strong Reputation in CSR
73.63 77.40
71.4476.16
2014 2015
CSR RepTrak® score
RepTrak® Pulse
• Sanofi gained 4.7 points in overall reputation and over 3.8 points in Corporate
Social Responsibility.
• Sanofi is ranked 1st when it comes to CSR
• Sanofi enjoys the best support in recommendation, with 68% of the public
strongly agreeing that they would recommend this pharma company
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
78.13
78.17
77.00
76.89
78.33
75.65
77.77
15.7%
12.8%
13.0%
16.3%
16.7%
11.6%
14.0%
“Acting ethically and responsibly enables Sanofi to go beyond what is required of a company, which means employees working to protect and promote access to healthcare for the greatest number. Corporate Social Responsibility also means supporting the local communities in the countries where we operate while also contributing to global health through specific Research & Development programs and private/public collaboration.”
~ Olivier Brandicourt, CEO of Sanofi16
REPUTATION LEADERS NETWORKSanofi Focuses on Improving Governance Amid CEO Ouster Scandal
Sanofi’s 2014 Record:
• Research and Development Focus:
• Having invested approximately 4.83B euros in R&D in 2014, Sanofi currently has 37 projects in the R&D pipeline, 12 of which are already in phase III. More than 50% of the projects come from collaborations and partnerships.
• Improving Corporate Governance:
• The ousting of former CEO Christopher Viehbacher by a unanimous vote of Board of Directors in October 2014 represented a move toward increasing transparency and improving relations within Sanofi’s internal governing apparatus. The company also implemented an alert system through which employees can report breaches of the company Code of Ethics.
• Expanding Learning Opportunities for Employees:
• Sanofi launched new academies for employee learning in the fields of quality, alliance management, medical affairs, LEAN, and supply chain. Program offerings have increased from 30 in 2010 to over 100 in 2014 and the company has delivered 200,000+ hours of training to its employees worldwide.
• Commitment to CSR:
• Sanofi has expanded its efforts to increase access to healthcare by promoting its AllStar® reusable insulin pen in developing countries, namely India, and launching education campaigns such as “Schoolchildren against Malaria” to teach children in Africa about malaria prevention.
VS.
Company focuses on diversification of product portfolio to meet patient needs
Company expands R&D spending and prepares for launching of new drugs and vaccines
Work environment focuses on increasing diversity and learning opportunities
Company leadership committed to transparency in corporate organization
Company continues to experience sales growth in most of its product lines
Compliance mechanisms established to ensure adherence to Code of Ethics
Sanofi’s mission to improve access to healthcare is reflected in their CSR strategy, their commitment to training employees and their concern for corporate transparency.
Company is committed to expanding access to safe healthcare
Sanofi website, 2015
17
REPUTATION LEADERS NETWORK
Return on Reputation
18
REPUTATION LEADERS NETWORK
Companies who invest in a strong reputation experience direct financial benefits
• A Strong link between Reputation and Stock Price - Since the 2008 crisis, those companies with a stronger reputation have performed significantly better (almost 2X the return) than the overall market. (see next 2 pages)
• Better Stock Price Recovery after a Crisis – all firms take a similar hit (8%) on average, but higher reputation forms bounce back faster and go higher afterward (RI Study)
• Benefit of the doubt in a crisis - 54% would give reputable companies the benefit of the doubt in a crisis compared to only 20% for lower reputation companies. (RT100)
• Influence on policy making - companies with better reputations are invited to provide input to policy makers when new regulations are designed (Qualitative research from RI policy maker and regulator studies)
• Access to acquisitions - buyers with better reputations are approached more often, are more likely to get the deal done and at a better price (Qualitative findings from RI CFO interviews)
• More recommendation - recommendation goes up by 6.5 percent for each 5-point reputation RepTrak® score improvement (RT 100)
• More Buying – propensity to buy goes up over 5% for each 5 point RepTrak® score improvement (Multiple RT studies)
• Attracting the best talent - a good company reputation is a top 5 driver for people when they consider which company they would like to work for. A higher reputation results in a significant increase in willingness to work for a firm (Analysis of Universum and Best Place to work findings )
• Higher Employee Engagement and Alignment - a good company reputation is a key driver for employee pride and engagement. A strong reputation is a leading indicator for employees willingness to deliver on the company strategy (RI findings from Employee Reputation and Alignment studies)
What is the Return on Reputation?
19
REPUTATION LEADERS NETWORK
The chart on this slide demonstrates that the RepTrak® Portfolio has outperformed the S&P500 Index since 2006. It has also done so by an increasingly wide margin since the financial crisis of 2008. An investment of $100 in the RepTrak® Portfolio would be worth $250 in 2013, whereas investing in the S&P would net approximately half of that, at ~$140.
There is a strong link between Reputation and Stock Price (U.S.)
20
REPUTATION LEADERS NETWORK5 point change in pulse results in 8.6% change in recommendation
Would recommend company 7% 10% 27% 52% 85%
Would buy the products
Reputation Score
8%
Would say something positive
Would work for
Would invest in
Would welcome into local community
14% 32% 57% 85%
7% 12% 29% 56% 86%
7% 10% 21% 38% 69%
6% 9% 19% 34% 69%
9% 15% 32% 56% 85%
Poor0-39
Weak40-59
Average60-69
Strong70-79
Excellent80+
Would trust to do the right thing 7% 10% 25% 47% 81%
+2%
+5%
+4%
+4%
21
REPUTATION LEADERS NETWORKHow does a positive Pulse movement impact Supportive Behavior?
Highlights
• Merck’s reputation score went up 10.2 points in the last year.
Besides its improvement in the Pulse score, it also significantly improved in all 7 dimensions of reputation ; 13 point increase
in Workplace!
• This increase in reputation resulted in 12% points increase in
recommendation and 7% point increase in trust
• In 2014 Merck expanded its product portfolio with
acquisitions and , is pioneering in the field of immunotherapy
through Keytruda, one of the first immunotherapies in the
market as of 2014.
• One of the U.S.’ top CSR spenders, Merck has an ample social
responsibility portfolio geared towards expanding access to healthcare in needy populations
• One of the first to get involved with the Ebola outbreak
“At Merck we believe there is strength in differences. Our ability to continuedelivering on our mission of saving and improving lives around the worldrelies on having globally and locally diverse teams of talented employees atall levels…That’s why we are deeply committed to fostering an inclusiveenvironment that embraces different perspectives and values thecontributions of each individual.”
Kenneth C. Frazier
Chairman and CEO, Merck
Would recommend
Would buy
Would trust
RepTrak®
Pulse Score
29%
32%
30%
41%
40%
37%
MSD201570.2
MSD201460.0
Welcome to neighborhood 31% 43%
22
REPUTATION LEADERS NETWORKTime for a change : Bayer
Would recommend
Say positive
Would buy
54.5%
55.4%
59.2%
56.6%
59.5%
59.4%
Highlights
• Bayer’s strong products and
recognizable brand has resulted in a strong reputation…but its time for a
change
• Bayer expands consumer care
segments and shifts production to life
science products, exclusively
• Work environment increasingly
shifting towards gender parity and
reflects demographic trends
• Corporate giving, education initiatives
and sustainability efforts align to mission of improving life quality
“Bayer opened up a new chapter in its history:we initiated the decisive step toward becominga pure Life Science company. In the future wewill focus our entire innovative capability ondesigning molecules and solutions that improvehuman health or nutrition. Never has ourmission “Bayer: Science For A Better Life” moretruly reflected who we are and what we do.”
Dr. Marijn Dekkers, Chairman of the Board of Management of Bayer AG
71.71 72.59
76.26 75.83
2014 2015
CSR RepTrak® score
RepTrak® Pulse
POOR
<40AVERAGE
60-69EXCELLENT
>80STRONG
70-79WEAK
40-59
Bayer AG, 2014 Annual Report
Trust 55.0%55.4%
Bayer2015
Bayer2014
23