Purpose Readiness Survey 2019 Germany Majority of Brands Not Purpose Ready

The Business Roundtable, a group of chief executive officers (CEOs) from major U.S. corporations, issued a “Statement on the Purpose of the Corporation” on August 19, 2019. This spectacular letter of intent, signed by 181 CEOs, expresses a shared commitment to a new corporate purpose: that moving forward, consumers, employees, suppliers, as well as the communities in which they work will be just as important as investors. In that light, shareholder value will no longer be the main focus or principle measure of activity. The topic of higher purpose is also being hotly debated in German boardrooms. However, many companies find it difficult to define a strong purpose for themselves and to put it into practice.

GLOBEONE addresses this topic in its new Purpose Readiness Study, as part of their “The Image of German Brands” series. Among the study’s findings, more than half of the companies and institutions surveyed show considerable purpose readiness gaps in their public perception. Some companies, including Volkswagen, Bayer, and Deutsche Bank are currently suffering from a particularly low level of credibility in many purpose-relevant dimensions. Bosch, Continental, Rewe, as well as Aldi, on the other hand, perform best and achieve a high Purpose Readiness score according to public perception.

The principle aim of this study focuses on the degree to which German companies are succeeding in today’s world, in terms of credibly positioning a strong purpose to an external audience. In order to contribute to a better world, the company should be perceived by the public as having as few negative associations and scandals as possible.

By definition, a corporate brand that is “purpose ready” should be seen as honest, authentic, responsible, sustainable, and future-proof. Only then, the company can address all interest groups convincingly and be prepared to communicate its purpose credibly.
Capturing this topic for the first time and supported by substantial data, GLOBEONE has developed the Purpose Readiness Index, which examines 10 purpose-relevant dimensions. In August 2019, 3,660 consumers between the ages of 18 and 65 were interviewed in a comprehensive survey. The survey examined 48 of the most popular German corporate brands addressing end customers directly, as well as four of the largest American technology corporations and other institutions (including political parties) for comparison.

The results speak for themselves.

A Majority of German Companies are Not “Purpose Ready”

  • More than half of the companies and institutions surveyed show considerable purpose gaps in their public perception. Some companies, including Volkswagen, Bayer, and Deutsche Bank, display a particularly negative perception in many of the purpose-relevant dimensions.
  • Only a few companies, more precisely Bosch, Continental, Rewe, and Aldi, are regarded as credibly “purpose ready“, with an index value over 70. Approximately 40 percent of the brands surveyed are at least partially “purpose ready” but must continue to work on their public perception in order to represent their purpose credibly.

German Car Makers: Lasting Negative Associations Due To The Diesel Scandal

  • In Germany, the diesel scandal has caused a significant loss in trust among manufacturers. As a result, these manufacturers are struggling with lasting negative associations. With Smart as the single exception, German car makers show considerable purpose gaps, with Volkswagen reaching a PRI of 46.8 as the most extreme score in this data set, thus performing significantly worse than the competition.

Political Disenchantment and Fear of Spying Characterize German Consumers

  • German consumers lack confidence in the established political parties and the federal government, unveiling political institutions as the clear losers of the Globeone PRI ranking. Political parties, especially the governing CDU and SPD, are perceived as particularly hypocritical and unsympathetic. In addition, the survey finds a considerable amount of distrust among Germans towards large American internet companies. Although these companies are perceived as innovative, the fear of spying overshadows any positive association. A prime example is the social network company Facebook, a company battered by data scandals and reporting one of the worst PRI scores of 43.5.



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