Pharma RepTrak 2015 The World s Most Reputable Pharmaceutical Companies

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1 Pharma RepTrak 2015 The World s Most Reputable Pharmaceutical Companies The Pharma Industry s Reputation in the Eyes of the General Public A Reputation Study with Consumers in 15 Countries RepTrak is a registered trademark of Reputation Institute 2015 Reputation Institute, all rights reserved

2 Why is reputation important? It is about gaining people s trust The business case for reputation Your success as a company relies on people supporting you Customers buying your products Policymakers and regulators giving you a license to operate For them to support you, they need to trust you. Trust you as a company that will deliver on its promises. Trust you as a company that has a good reputation. The financial community investing in you The media reporting on your point of view Employees delivering on your strategy 2

3 and delivering on that trust by living up to expectations The business case for reputation For your stakeholders to trust you, you need to deliver on their expectations If you deliver on these 7 dimensions, you will gain support from each stakeholder. They expect you to be leading on 7 key dimensions: 1. Products / Services 2. Innovation 3. Workplace 4. Governance 5. Citizenship 6. Leadership 7. Financial Performance How do they see you? 3

4 Pharma RepTrak 2015 Big Pharma s Reputation with the General Public PHARMA INDUSTRY REPUTATION Big pharma reputation with the general public in 15 markets STUDY: Pharma RepTrak Pharma RepTrak 2015 Number of Countries 15 Number of Companies 12 Number of Ratings DATA COLLECTION: JAN FEB 2015 STAKEHOLDER: GENERAL PUBLIC QUALIFIED COMPANIES ABOVE AVERAGE REPUTATION IN HOME MARKET HIGH FAMILIARITY WITH CONSUMERS IN 15 MARKETS GLOBAL FOOTPRINT IN PRODUCTION/DISTRIBUTION 4

5 How to understand the numbers behind Pharma RepTrak 2015 Significant differences and normative scale Significant differences Significant differences In any study based on a sample of the population, there are statistical errors in all measurements. Global- Pharma RepTrak Countries Emerging/De veloped and Global Emerging vs Developed Company Global Company Between Markets Company Emerging/De veloped and Global Company Emerging vs Developed The table to the right shows the difference needed between two scores before they can be said to be significantly different. Reputation Dimensions/Expressive ness/personality > 0,5 > 2,0 > 0,6 > 0,7 > 1,8 > 7,0 > 2,4 > 2,6 Only score differences that are statistically significant will be shown in this report. RepTrak Pulse > 0,3 > 1,0 > 0,3 > 0,4 > 0,9 > 3,5 > 1,2 > 1,3 Normative scale Using an extensive database containing results from thousands of studies throughout the world since 1998, Reputation Institute has developed a normative scale (in everyday language the traffic lights ) that indicates whether a particular score is high or low when benchmarked against previous studies of a similar character. Excellent/Top Tier Above 80 Strong/Robust Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 5

6 Pharma RepTrak The World s Most Reputable Pharma Companies

7 Pharma RepTrak 2015 includes 12 global pharma companies in 15 key markets 12 global pharma companies competing in the 15 largest economies Global Mature Markets For the title pf the most reputable pharma company Australia Canada France Germany Italy Japan Spain UK USA Emerging Markets Brazil China India Mexico Russia South Korea 7

8 Standing out on what matters three things drive pharma reputation! Citizenship and governance are now more important than ever before 1 1 Being a responsibly run company that behaves ethically and is open and transparent in its business dealings Offering high-quality excellent products and reliable services Being a good corporate citizen that supports good causes and protects the environment ü ü ü ü ü ü ü ü Key personality drivers Honest, sincere, trustworthy, socially responsible Reliable, secure, hardworking Concerned, reassuring, supportive, agreeable Friendly, pleasant, open, straightforward Imaginative, up-to-date, exciting, innovative Technical, corporate Ambitious, achievement oriented, leading Prestigious, exclusive, refined 8

9 Pharma reputation development Pharma reputation remains average over years ,7-3,0 65,9 65,7 n= n= n= Excellent/Top Tier Above 80 Strong/Robust Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 All Global RepTrak Pulse scores that differ by more than +/-0,3 are significantly different at the 95% confidence level.. Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the RepTrak Pulse score on a scale). 9

10 Companies all fall into the average tier and the lack of differentiation seen over years continues All companies are average but can be divided into three tiers. Bayer keeps the lead for the fourth year in a row Pharma RepTrak - Winners ,2 67,5 66,9 66,9 66,1 68, ,0 65,0 64,9 64,8 64,8 66,9 67,6 66,5 64,6 64, ,5 65,5 64,9 65,1 Excellent/Top Tier Above 80 Strong/Robust ,6 65,0 65,0 Average/Moderate Weak/Vulnerable n= Poor/Bottom Tier Below n= ,1 All Global RepTrak Pulse scores that differ by more than +/-0,9 are significantly different at the 95% confidence level.. Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the RepTrak Pulse score on a scale). 10

11 Global pharma s reputation is mixed while 34% perceive the industry as having an excellent reputation, 23% perceive the industry s reputation as weak/poor Pharma Industry RepTrak Score Globally 65,7 Reputation Score Distribution among respondents 15% 23% 15% 13% 34% Excellent/Top Tier Above 80 Strong/Robust RepTrak Mean Score 21,1 50,7 65,4 74,6 91,8 Average/Moderate Poor Weak Average Strong Excellent Weak/Vulnerable Poor/Bottom Tier Below 40 n=

12 Reputations have remained stable for most companies Lilly, GSK, and Bristol-Myers Squibb have seen significant improvements, while Novo Nordisk and Novartis have faced significant declines Rank Global Reputation Gap 2015 vs Rank Global Reputation Gap 2015 vs ,4 69,2-0,8 7 65,1 66,9-1,8 2 67,6 67,5 0,1 8 65,0 64,9 0,1 3 66,9 66,9 9 65,0 65,0 4 66,5 65,0 1, ,9 64,8 0,2 5 65,5 64,3 1, ,1 64,8-0,7 6 65,5 64,6 0, ,6 66,1-2,4 Excellent/Top Tier Above 80 Strong/Robust Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 Statistically non-significant score difference between 2014 and 2015 Statistically significant score difference between 2014 and n= n= All Global RepTrak Pulse scores that differ by more than +/-0,9 are significantly different at the 95% confidence level.. Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the RepTrak Pulse score on a scale). 12

13 Global pharma reputation in 2015 is average across the board 4 markets are outliers , ,7 70,9 69,8 65,8 73,5 Russia 58,9 65,7 RepTrak Score Globally Mexico Canada 66,5 USA 66,3 UK Spain 62,5 64,7 Germany France 64,5 Italy 62,4 India China S. Korea 60,4 Japan 61,0 Brazil 73,1 Australia Excellent/Top Tier Above 80 Strong/Robust Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 n= All Global RepTrak Pulse scores that differ by more than +/-1,0 are significantly different at the 95% confidence level.. Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the RepTrak Pulse score on a scale). 13

14 48-58% of the public are unsure about what the pharma companies are doing on the 7 dimensions Pharma, Global Dimensions [sorted by Dimension] Negative (1-2) Neutral (3-5) Positive (6-7) Not Sure Products/Services 4,5% 45,1% 47,3% 3,2% Innovation 4,4% 45,9% 44,9% 4,9% Workplace 4,5% 42,7% 37,4% 15,3% Governance 6,1% 45,5% 38,7% 9,7% Citizenship 6,1% 45,5% 36,5% 12,0% Leadership 4,7% 44,6% 40,2% 10,5% Performance 3,7% 43,4% 43,8% 9,0% Product/Services: 'Company' offers high quality products and services -- it offers excellent products and reliable services Innovation: 'Company' is an innovative company -- it makes or sells innovative products or innovates in the way it does business Workplace: 'Company' is an appealing place to work -- it treats its employees well Governance: 'Company' is a responsible company -- it behaves ethically and is open and transparent in its business dealings Citizenship: 'Company' is a good corporate citizen -- it supports good causes and protects the environment Leadership: 'Company' is a company with strong leadership -- it has visible leaders and is managed effectively Performance: 'Company' is a high-performing company -- it delivers good financial results n=

15 Mature and emerging markets remain at similar levels to 2014 mature markets score higher across all dimensions Global 68,4 66, ,4 65,6 Strong/Robust 66,6 64,1 64,1 64,1 63,2 63,6 n= n= n= ,1 65,9 70,2 68,5 65,2 67,3 70,3 66,1 66,4 69,7 65,8 63,5 64,9 64,8 64,8 63,5 Excellent/Top Tier Above 80 69,6 66,5 66,0 65,3 64,2 68,7 66,4 67,7 Emerging Markets 70,2 70,7 67,5 65,7 63, Mature Markets 65,1 67,3 65,6 66,5 64,5 63,5 64,5 64,7 64,3 n= n= n= Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 All Emerging/Mature RepTrak Pulse scores that differ by more than +/-0,3 are significantly different at the 95% confidence level.. All Emerging/Mature Dimension scores that differ by more than +/-0,6 are significantly different at the 95% confidence level. 15

16 Familiarity (Top 4 %) Familiarity with pharma companies remains low compared to other global RepTrak 100 companies 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Novartis AstraZeneca GlaxoSmithKline Pfizer Bayer Bristol-Myers Squibb Sanofi Merck / MSD Lilly Novo Nordisk Roche Abbott Laboratories Sony Microsoft Apple Canon The Walt Disney Company Google 90% 80% BMW LEGO Familiarity (Top 4 %) 100% 70% 60% 50% 40% 30% 20% 10% GlaxoSmithKline Pfizer Roche Novartis Bayer Sanofi AstraZeneca Abbott Laboratories Bristol-Myers Squibb Lilly Merck / MSD Novo Nordisk Microsoft Samsung Electronics Sony Apple Canon Google The Walt Disney Company BMW Rolex The LEGO Group Daimler 0% 0% Global RepTrak 100 Pulse Pulse Score Score n= Global RepTrak 100 Pulse Pulse Score Score n= Q: How familiar are you with the following companies? All Global RepTrak Pulse scores that differ by more than +/-0,9 are significantly different at the 95% confidence level.. 16

17 Reputation Your #1 Driver of Support

18 Improving reputation increases willingness to recommend the company 48% Improve reputation by 5 points and increase recommendations by 3.7% If a company improves its reputation by 5 points, the number of people who would definitely recommend the company goes up by 3.7%. Willingness to Recommend (Top 2 %) 46% 44% 42% 40% 38% Global RepTrak Pulse Score Adj R²= 0, n= Q: I would recommend Company to others All Global RepTrak Pulse scores that differ by more than +/-0,9 are significantly different at the 95% confidence level.. 18

19 Improving reputation means added support across the board moving reputation from average to strong leads to 17%-20% more support Reputation Score Buy 9% 15% 34% 54% 84% Recommend to Others 9% 12% 30% 49% 81% Welcome to Community 9% 15% 31% 49% 79% Work for 11% 17% 34% 51% 78% Excellent/Top Tier Above 80 Strong/Robust Invest 9% 13% 26% 43% 71% Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 n=

20 Emerging markets present a great opportunity to win support by improving reputation, whereas support is more hard-earned in mature markets Reputation Score Buy Mature Markets Emerging Markets 5% 10% 24% 41% 81% 14% 21% 48% 75% 92% Recommend to Others Mature Markets Emerging Markets 5% 6% 19% 35% 77% 13% 20% 46% 71% 91% Excellent/Top Tier Above 80 Strong/Robust Average/Moderate Weak/Vulnerable Poor/Bottom Tier Below 40 n=

21 Methodology of RepTrak 100

22 The Global RepTrak 100: Measuring the World s Most Reputable Companies The Global RepTrak 100 Study Measures Corporate Reputations Worldwide Reputation Institute conducts the only truly global study designed to identify and assess the best corporate reputations around the world. In February and March 2015, more than ratings were collected from about global consumers invited to measure 100 finalists of the World s Most Reputable Companies in 15 markets. The purpose of this study was to create an index of global companies that were both well regarded in terms of reputation in their home markets, as well as successful in managing their reputations around the world, given their global footprint. This study provides an assessment of the global reputation landscape the companies that are most trusted, respected and admired by the public across 15 markets. Defining Reputation Research by Reputation Institute since 1999 shows that strong reputations are based on four key concepts: admiration, trust, good feelings and overall esteem. The RepTrak Pulse Model The RepTrak Pulse Model measures the admiration, trust and good feeling that stakeholders have towards a company. The RepTrak Pulse is the beating heart of a company s reputation, providing an overall assessment of the health of a company s reputation. Reputation Institute s research indicates that a reputation is built on 7 dimensions from which a company can create a strategic platform for communicating and engaging with its stakeholders. The RepTrak Pulse Model has 7 dimensions that were identified in qualitative and quantitative research as best explaining the reputation of a company. In the Global RepTrak 100 study, Reputation Institute measures not only perceptions of companies on the core RepTrak Pulse attributes but also asked respondents to rate the companies on the 7 key dimensions. Companies Rated Reputation Institute identified a set of companies that qualified as candidates for inclusion in the Global RepTrak 100 study. To be included these companies had to meet specific criteria that made them viable candidates for the study. These criteria included annual revenue, above average home country reputation derived from Reputation Institute s global database, multinational presence and high familiarity with consumers in the measured 15 markets. Survey Methodology The Global RepTrak 100 study was conducted online in all 15 countries. Each respondent rated a maximum of 5 randomly assigned companies from the list with which they were familiar, using Reputation Institute's standardized RepTrak Pulse. When interpreting results, all Global RepTrak Pulse scores that differ by more than +/-0.9 are significantly different at the 95% confidence level. Over reputation ratings were obtained in this study, and each company received a minimum of 100 ratings across the 15 countries. Questionnaire The Global RepTrak 100 questionnaire is a 15-minute online survey that invites respondents to describe their perceptions of companies. Through rigorous statistical analysis, Reputation Institute connects the reputation dimensions with the RepTrak Pulse scores as well as with a measure of overall public support, to identify the drivers of corporate reputation. Doing so enables companies to understand what matters to the general public. 22

23 How are corporate reputations measured? Reputation is driven by 7 dimensions measured by the RepTrak Pulse For each company in the study, perception measures are taken of each of the factors in the model we measure respondents trust, admiration, esteem and good feeling to form a single average score across 15 countries (the Global RepTrak Pulse), which is the dependent variable used in our driver analysis. When the full set of dimension ratings for the 100 companies are statistically analyzed against this score, we find that to earn a strong reputation, companies need to address all 7 dimensions of reputation. Emotional Rational explanation of the emotional 23

24 About the study -The 2015 Global RepTrak 100 Data Collection Period February - March 2015 Qualified Companies Include companies with Home Country Reputations above Global Mean Remove non-public facing companies Remove low international scope Remove smallest companies <$6B (US), <$1B (Int) Stakeholder Group General Public Respondents distribution was balanced to the country population on age and gender Sample was also controlled for region Qualified Respondents Familiarity: Based on a 7-point scale, respondents must select at least 4 in order to qualify to rate a company RepTrak Pulse: To provide measures on at least three of the four pulse statements Questionnaire All companies are evaluated on the RepTrak Pulse and the 7 dimensions of reputation Supportive behavior is also assessed by asking questions on willingness to buy, recommend, invest, work for, welcome into neighbor, say something positive about and trust to do the right thing if faced with a problem Data Collection Method Web-based questionnaire in 15 countries Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russia, Spain, South Korea, United Kingdom, United States Length of Interview 15 minutes Number of Countries Number of Companies Number of Industries Number of Respondents Number of Ratings

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