Pi-Consulting

A blameless corporate reputation is an increasingly valuable asset among big companies, as consumers turn on corporations who cook their books, exploit their third-world work force, or endanger our planet’s well-being. Need a better rep? Why not buy one? French-based cosmetic giant L’Oreal decided to do just that, bidding 34% over the odds to buy up “environmentalist” retailer Body Shop International, whose founder Anita Roddick is a pin-up girl for ‘greens’ and the responsible employment movement. The problem may be that a reputation transplant may be a little like a skin-graft: the cosmetic attraction can be powerful, but the grafted-on tissue may reject. Chris Bones, principal of Henley Management College put it thus: “Mergers between the large and the virtuous only work when the cultures of the two companies… are similar”. Mr. Bones knows of what he speaks, having advised on the recent takeover of “ethical and organic” chocolate-maker Green & Black by UK-based chocolate giant Cadbury. The deal worked out well because of Cadbury’s continued observance of the principles of its Quaker founders. Mr. Bones is less hopeful for the L’Oreal/Body Shop nuptials, partly because of intrinsically different commercial world views, and partly because “French and British management teams mix like oil and water”. Source: The Economist).