Is brand your board’s biggest blind spot?

Why boards struggle with brand

First, relatively few directors bring deep brand experience to the table. Those who do often come from marketing or corporate affairs backgrounds, where brand lives in the operating rhythm of the business. The concept of brand doesn’t always translate easily into the board language of strategy, risk, capital allocation, incentives and accountability.  

Second, brand remains vague for many directors trained in law, finance or accounting. As an idea born from the marketing discipline, it is sometimes viewed with scepticism – seen as subjective, difficult to measure, or taking a back seat to ‘hard’ financial performance.  

Third, boards often lack a shared language for engaging with brand. Without a common framework, brand conversations default to standalone issues like an advertising campaign, sponsorship controversy, or crisis response. What is missing is systematic oversight and a sense of the long-term value that brand represents.

To bring the point home, consider that behind almost every major brand crisis sits a governance failure.  

Brand failure is governance failure

Unfortunately, there’s no shortage of examples.

The prioritisation by Qantas of corporate self-interest resulted in outdated product, declining service quality and reliability, eroding trust and preference. It’s now bouncing back, thanks to the brand’s strength and its impact on business resilience, but it has been a bumpy ride that has shaken stakeholder relationships.  

Rio Tinto’s destruction of the Juukan Gorge cultural heritage sites represented a catastrophic corporate social responsibility fail, with lasting reputational, commercial and career consequences.  

ANZ’s post-Royal Commission challenges, including record ASIC penalties and ongoing restructuring costs, continue to weigh on trust, employee engagement and investor credibility.  

These episodes were not marketing failures. They were failures of oversight, incentives, culture, compliance and policy. And they had real consequences.

If brand damage can destroy value so decisively, it deserves to be treated as a core board issue – not only through a risk lens, but also as a strategic driver.  

Two ways boards should think about brand

A useful starting point is to recognise that brand has two distinct but related dimensions:

1. Brand as customer value proposition (CVP) – what you sell 
2. Brand as reputation – who you are

Boards often encounter these dimensions separately, thanks to functional reporting, measures or strategies. In reality, they are two sides of the same coin.

Brand as CVP is the classic marketing construct. It encompasses the total bundle of value offered to customers – product, service, experience, price, and meaning – amplified through marketing and distribution.

A strong CVP enables a business to attract and retain customers, sustain price premiums, drive repeat purchase and advocacy, and defend against commoditisation and competition.

A weak CVP is not a marketing problem. It is an existential business risk.

The recent collapse of US department store brand Saks Global, following its highly leveraged acquisition of Neiman Marcus, illustrates this clearly. No doubt the board devoted significant attention to the financial engineering and investor narrative of the transaction. Presumably overcoming the traditional objection that combining two underperforming department stores is rarely a formula for success.

But the governance question is whether enough time was spent on the customer value proposition as a key element of strategy.

Department stores started in the 19th century with a powerful CVP: curating hard-to-find, aspirational products for a burgeoning middle class seeking access to exotic and exclusive goods. Today, customers face the opposite problem of overwhelming choice and near-zero barriers to access, thanks, in large part, to online shopping.

Did the Saks Global board sufficiently interrogate the question at the heart of the business? Why should a customer continue to spend time and money here, and ideally pay a premium? And was the answer backed by disciplined capital allocation and management focus?

The core engine of any sustainable retail business – a compelling reason to engage and spend – is the CVP. Its long, slow erosion is a governance failure and one we have seen before. Case in point, the infamous collapse of Kodak, a result of the company’s failure to adapt to photography’s digital revolution.

A strong brand has a strong CVP. A weak CVP is a material risk. If a board is not confident that management has a clear, defensible and future-proof strategy, it belongs at the top of the agenda.

Brand as reputation

If brand as CVP is about what customers are buying, brand as reputation is about who they are buying from and whether stakeholders respect and value the organisation.

This extends beyond customers to investors, employees, regulators, communities and partners. Its measures go beyond sales and market share to trust and social licence, influence and investment attractiveness.

Bad corporate or leadership behaviour can damage reputation, undermine a strong CVP or create risk of outside intervention from regulators or investors.

Take Tesla. Elon Musk’s increasingly polarising public behaviour has alienated a segment of the progressive-minded consumers who helped build the brand, without replacing them with an alternative customer base of right-wing EV enthusiasts. While the product may remain compelling, brand desirability has been damaged.

Closer to home, logistics software firm WiseTech Global illustrates a different dynamic. The company has a compelling product-level CVP, but ongoing concerns about the leadership behaviour of the firm’s founder-CEO, Richard White, raise questions about succession, talent attraction, good governance and commercial sustainability – all of which matter deeply to cautious enterprise customers and investors alike.

Most boards will never face the extremes of a founder-CEO acting counter to stakeholder expectations. But the underlying lesson is universal - reputation risk is brand risk. And brand risk directly affects future earnings and valuation.  

Reputation is a competitive advantage

Some directors still view reputation as merely a ‘licence to operate’. But, in many sectors, it is a source of competitive advantage and essential to growth.

This is especially true in highly regulated or socially sensitive industries such as development, natural resources, energy, financial services, alcohol, gambling, healthcare, and services for vulnerable customers. In these sectors, companies compete not only on price and quality, but on trust: integrity, values and concern for the potential negative impacts of their business.

The same applies to organisations with significant market power or dominant share, where scrutiny from regulators, politicians and communities is inevitable.

In these contexts, reputation is brand because it enables influence and access, more favourable regulatory outcomes, access to growth opportunities and capital.

People and culture are a key part of this equation, too. An organisation’s ability to attract, retain and motivate talent is inseparable from how it is perceived to behave, lead and govern itself.

The rising focus on Environmental, Social, and Governance (ESG) has only intensified this convergence. Concerns that once sat with communities or employees now directly influence investor decisions and shareholder value.

The most enduring damage occurs when brand failure strikes at the heart of what an organisation claims to stand for, undermining confidence in its value proposition or future success.

In those moments, recovery is slow, expensive and uncertain. Capital is wasted, strategic options narrow, leadership credibility erodes, and boards find themselves reacting rather than governing.  

What should boards do differently?

Brand will never be ‘owned’ by the board in the way financial integrity, leadership succession or strategic direction setting is. And boards do not need to become marketers to govern brand effectively. But they should see themselves as stewards of the brand for the long term.

It is well within the capabilities of board directors to ensure there is a clear, defensible, sustainable customer value proposition aligned to strategy and backed by capital allocation and management focus. Directors need to develop an understanding of how reputation and stakeholder trust create or destroy competitive advantage for their specific business.

To put this into action, directors must test whether incentives, policies, culture and leadership behaviour reinforce or undermine the brand. They must treat brand as a standing governance objective, not a reactive crisis response or occasional advertising eye candy.

If brand is your most valuable intangible asset, and your board does not have a disciplined way of overseeing it, then brand may be your biggest blind spot.

And blind spots are where the greatest governance failures – and value destruction – tend to occur.