Numerous reputation studies have found a positive correlation between a company's reputation and its financial value. However, the causality has not yet been clearly proven in studies.
Two effects could explain the correlation:
- (1) The investment effect: investing in reputation-building image campaigns and professional reputation management do not increase the value of the company in the short-term, but often only in the medium-term.
- (2) The performance effect: a higher-than average company value has a positive influence on the future reputation, even in the short term.