The economics of reputation are built on
Strategy, Leadership and Accountability
Diageo's 3 Key Drivers of Success in Repu...
2
THE WORLD ’S LEADING
PREMIUM DRINKS BUSINESS
Selling the world’s best known brands in
180 markets
WORLD CLASS MARKETING
3
THE WORLD ’S LEADING
PREMIUM DRINKS BUSINESS
25,000talented employees
in around 80countries
Over £10bnturnover
Over £1bn...
4
Our Heritage
1986
Distillers
Company
Limited
taken over
by Guinness
and renamed
United
Distillers
1884
James Buchanan es...
5
Societal Trust is Low and Declining
Trust in Business
Trust in Business Leaders to tell the truth
50%
18%
Global
-32
201...
6
Business as Soap Opera
…loss of trust is the new media narrative
7
Changing Regulatory and Legislative Framework
EU calling for
greater corporate
accountability
Top companies in
India mus...
8
New Consumer and Customer Priorities
CONSUMERS:
66% consumers expect brands
to be sustainable*
46% consumers are prepare...
9
Reputation
Trackers 2012
Ireland: 4.2
GB: 4.1
Scotland: 4.4
marked / 5
scores > 3 +ve
Diageo Hellas
Platinum CSR award
(...
10
- REPUTATION STRATEGY
Our Ambition:
To create the best performing, most trusted
and respected consumer company in the world
11
12
We Define Our Stakeholders As:
• Investors
• Employees
• Government and NGOs
• Commercial Partners (Customers, Supplier...
13
Responsible
drinking
Sustainability
Employer
attractiveness
Product
innovation
Relationship
Management
Leadership
Contr...
14
- REPUTATION FUTURE TRENDS
Global business trends in reputation management
Reputation
is
becoming
a critical
business
driver
Reputation
strategies
ar...
Global FUNCTIONAL trends in reputation
management
As
reputation
becomes a
critical
business
driver:
Functions
develop
more...
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Reputation – A Critical Driver of Business Value, by Ian Wright MPRCA, Corporate Relations Director, Diageo

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  • Some of the world’s best known brands – many of these are produced in Scotland.Exporting to 180 markets across the world – Johnnie Walker was one of the first truly global brands.Enhancing our position through world class marketing and consistently leading the industry in innovation and advertising.
  • Over £10bn turnover and over £3bn operating profit (year ended 30 June 2012 organic movement)“Faster growing markets are 42% of Diageo’s net sales in the first half of 2013, and delivered organic net sales growth of 14% and OP growth of 21%” (Interims, Feb, 2013)Ambition to have 50% of our business from high growth markets – Eastern Europe, Africa, Latin America and most of Asia Pacific – by 2015 (year ended 30 June 2012 – Annual Report).
  • 2. …a serious crisis of confidence in leaders of both business and government
  • The EU is calling for greater corporate accountability on social and environmental impact. And wants to survey public trust in business.
  • A number of consumer businesses taking driving commercial opportunities from S&RJ Sainsbury ‘Our sales of fairly traded products will hit £1 billion.’P&G have committed to develop cumulative $50 billion sales by 2020Kering / PPR brand group developing sustainable luxury
  • BUT:Not all positive. For instance, Diageo ranked 26th out of 29th in a consumer study of brand leaders and laggards in the field of environmental and social leadership. Source: The regeneration consumer study Oct 2012.Korea…
  • Reputation – A Critical Driver of Business Value, by Ian Wright MPRCA, Corporate Relations Director, Diageo

    1. 1. The economics of reputation are built on Strategy, Leadership and Accountability Diageo's 3 Key Drivers of Success in Reputation Building, 1 Ian Wright , Global Corporate Relations Director , Diageo
    2. 2. 2 THE WORLD ’S LEADING PREMIUM DRINKS BUSINESS Selling the world’s best known brands in 180 markets WORLD CLASS MARKETING
    3. 3. 3 THE WORLD ’S LEADING PREMIUM DRINKS BUSINESS 25,000talented employees in around 80countries Over £10bnturnover Over £1bnoperating profit Diageo invests over £1.5bnin marketing and promotion each year 42%of business in fastest growing markets – accounting for 21%of operating profit growth 50%of net sales in fast growing markets expected from 2015
    4. 4. 4 Our Heritage 1986 Distillers Company Limited taken over by Guinness and renamed United Distillers 1884 James Buchanan establishes his business 1877 DCL established by John Haig of Cameronbridge distillery and others 1871 James & Samuel Greenlees, of Old Parr, establish their business 1863 William Sanderson, creator of Vat 69 establishes his business 1825 Thomas Sandeman starts trading & Arthur Bell joins business in 1845 1820 John Walker opens for business 1749 Justerini & Brooks founded 1627 Haig family start distilling 1890 White Horse trademark registered 1997 Diageo formed 2001 Seagram aquisition
    5. 5. 5 Societal Trust is Low and Declining Trust in Business Trust in Business Leaders to tell the truth 50% 18% Global -32 2013 Edelman Trust Barometer
    6. 6. 6 Business as Soap Opera …loss of trust is the new media narrative
    7. 7. 7 Changing Regulatory and Legislative Framework EU calling for greater corporate accountability Top companies in India must spend 2% of profit on CSR RSA requires firms to have Social & Ethics Committees China is toughening environmental legislation Elsewhere sustainable reporting requirements are in place MNCs to protect human rights along whole supply chain
    8. 8. 8 New Consumer and Customer Priorities CONSUMERS: 66% consumers expect brands to be sustainable* 46% consumers are prepared to pay a premium for brands seen as sustainable* Expectations are particularly strong among millennials and consumers in high growth markets** *Source: ACNielsen 2012 ** Futures Group 2013 CUSTOMERS: Walmart to disclose sustainability scores on shelf labels for 70% of products Safeway wine suppliers rejected on environmental grounds Sainsbury’s and Marks & Spencer to reduce abv of alcohol products and increase fair trade sales
    9. 9. 9 Reputation Trackers 2012 Ireland: 4.2 GB: 4.1 Scotland: 4.4 marked / 5 scores > 3 +ve Diageo Hellas Platinum CSR award (90% + score) Ranked 2nd in food and beverage, scored 4.8/5 • Ireland & Nigeria No. 1 • Portugal 3rd • Mexico 4th • Germany & Venezuela 7th • Greece top ten Reputation is Made Locally
    10. 10. 10 - REPUTATION STRATEGY
    11. 11. Our Ambition: To create the best performing, most trusted and respected consumer company in the world 11
    12. 12. 12 We Define Our Stakeholders As: • Investors • Employees • Government and NGOs • Commercial Partners (Customers, Suppliers, Partners…) • Community and Special Interest Groups • Media • Consumers of our brands
    13. 13. 13 Responsible drinking Sustainability Employer attractiveness Product innovation Relationship Management Leadership Contribution to society TRUST & RESPECT Brand builder Accountability - Diageo reputation drivers Diageo reputation attributes and local market attributes to be defined
    14. 14. 14 - REPUTATION FUTURE TRENDS
    15. 15. Global business trends in reputation management Reputation is becoming a critical business driver Reputation strategies are more robust and thoughtful Leadership expect- ations are increasing Leadership engagement is increasing Leadership reputation capability is required Leadership account- ability is increasing - KPIs & scorecards
    16. 16. Global FUNCTIONAL trends in reputation management As reputation becomes a critical business driver: Functions develop more robust and thoughtful reputation strategies Strategies and programs are more integrated and less siloed Functions are changing to meet new demand Push and pull between HQ & big market infra- structure versus fastest growing markets Reputation capability Reputation Tracking Reputation Forecasting Reputation Tracking and Insights Reputation Workshops Functional Planning Conversations Changing infrastructu re and skillsets Changing ways of working Resource where needed Big bets from the centre Delivered for leaders Delivered for functions Cascading and impact Comprehens- ive & tailored

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