The Study On The Effect Of Listed Companies' Reputation On Financial Performance

Recently, with the development of the society, the quality competition and price competition gradually transition to the reputation competition. Establishing and maintaining companies' reputation become more and more important. In western countries, the research of reputation is earlier and in-depth, so the reputation mechanism play an important role and effect the corporate governance. However, our country's research in reputation is in the initial stage. In the theory, we are in the stage of introducing foreign research. In the empirical research, we haven't have mature evaluation method of companies' reputation, so the empirical tests are short of depth and breadth. Just these hinder the further development of corporate governance and capital market.This paper have mainly solved three problems about companies' reputation:What, what is companies' reputation? How, how to evaluate companies' reputation? Whether, whether the companies' reputation has effect on financial performance? Firstly, this paper have reviewed and analyzed the definition of companies' reputation, its starting and development, its different angle. And then according to the research content of this paper and based on stakeholder theory this paper defines companies' reputation; Secondly, this paper conclude and analyse the evaluation method of companies' reputation all around world. Based on the "reputation quotien's" maturity, globality and extensive use, according to the date's attainability, globality and consistency this paper quantize "reputation quotient".After analyzing the feature of Chinese companies,this paper add Chinese companies'specific indicators and establish reputation evaluation index system of Chinese companies. Based on these, this paper use factor analysis method to lower dimensions and weighting. At last, this paper establish evaluation model of companies' reputation; Finally, relying on the evaluation model, learning from 8 industry 293 listed companies of Shanghai's share between 2006-2010 this paper empirically test the companies'reputation's effect on financial performance.The results show that good companies' reputation could bring all kinds of stakeholders' following and loyalty. Companies' reputation has positive relationship with financial performance. Good reputation could promote the increase of later financial performance. However, with the extension of time the significant and the promoting effect decrease gradually.