The Benefits of Corporate Relationship-Building & Legitimacy

corporate reputation legitimacyAccording to William Benott and Augustine Pang, a company’s image is “subjective because it arises from information held by people about that company.”

With this in mind, one’s ideas about a company and its relationships with external audiences can be positively or negatively affected by the perceptions people form.

According to Benott, a firm’s reputation can influence “how closely the government regulates its actions…loans and credit offerings, and whether a supplier is willing to wait for payment.” This can be especially true for nonprofit organizations.

When one’s entire budget is dependent on the perception of its community members and program performance, image can have a direct affect on the organization’s ability to survive.

It is important for nonprofits, especially those small in number and resource, to understand the role legitimacy plays in building their reputations.  In appeals to the ideas and beliefs of potential donors and volunteers, a nonprofit asks people to adapt to its “ideas and mission by convincing them that the nonprofit helps make the community a better place to live.”

One way of doing this is building legitimacy by aligning oneself with a larger, more-established business that is respected within the community and willing to share resources.

By establishing these relationships, a nonprofit organization can build its corporate reputation and attract potential investors, customers, employees, and volunteers.  According to Arild Wæraas, legitimacy and the trust of community members will allow any organization to”continue to exist or exercise dominance in their environment.”  Since Max Weber’s definition of legitimacy “lies in the citizen’s perception,” it is important for the organization to promote a favorable image that community members will continue to support through donations and volunteer activities.

Wæraas’ emphasis on legitimacy is supported by Dr. Nell Huang-Horowitz’s claim that “legitimacy is essential for the survival” and that corporate reputation-building activities are important tools for gaining trust.  She suggests that although smaller organizations understand the value of corporate reputation, they don’t undertake reputation-building strategies.  It is important for public relations professionals operating in smaller environments to guide organizations towards reputation-building activities, strategic alliances, and a positive image for the company.

Suggested Readings:

  • Arild Waeraas – The re-enchantment of social institutions: Max Weber and public relations
  • Nell Huang-Horowitz – Conceptualizing a theoretical model for the practice of public relations in the small business environment
  • William Benott and Augustine Pang – Crisis communications and image repair discourse

Yasheaka Oakley Owens

Yasheaka Oakley Owens is the owner of YOakleyPR, a woman-owned small business that provides public relations, social media, and online marketing support services to small businesses and 501(c)(3) nonprofit organizations in Southeastern Pennsylvania, Southern New Jersey and Delaware.

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  • What caught my attention about this particular post were the terms ‘relationship-building’ and ‘legitimacy.’ I agree with you. I wrote a paper about relationship-building and mediation through social media, as they are a dialogic space, and found out that the motivations for users to generate their own content matches the principles of dialogue. Basically, I have concluded that if public relations and their organizations strive for a more transparent and responsible practice, social media can prompt an ideal scenario for engaging with different publics through dialogue and, thus, build and mediate relationships.