Amazon Named ‘Most Reputable’ While Apple Doesn't Make the Cut

NEW YORK (TheStreet) -- Amazon (AMZN) has again been named the most reputable company in the country, for the second year in a row.

According to the Reputation Institute, Amazon deserves the No. 1 spot in the ranking. In 2013, Walt Disney  (DIS) took first place, and Amazon was in third place, trailing Intel (INTC).

This year, Amazon scored 84.08 out of 100, while Kellogg's (K) came in second with 81.50. Lego came in third with 81.49 and Fruit of the Loom, at 81.23, was fourth.

The Reputation Institute ranked the top 100 reputable companies based on 23,750 consumer respondents and 57,746 ratings. The survey measures the public's perception of companies based on innovation, leadership, governance, citizenship, workplace, performance and products/services.

Amazon's success can be tied to its focus on the consumer, with one of the company's top leadership principles being "We try not to spend money on things that don't matter to customers." Consumers appreciate this attention and transparency, according to Brad Hecht, vice president and chief research officer of the institute. They value corporate governance and whether the company is perceived as fair and making a positive impact on society.

"This is where [Amazon CEO Jeff] Bezos has been exceptional," Hecht said. "If there's one thing [Amazon CEO Jeff Bezos has] hammered home, it's that he will do anything in his power to improve the experience for the consumer."

In addition to boosting the company's credibility, Amazon's top ranking could have a positive impact on its stock.

"We know there is a correlation between being in the top 10 in reputation in the U.S. and stock price," Hecht said. "We've tracked it all the way back to 2006. Your performance relative to the S&P average is better."

Since 2006, Amazon shares have jumped more than 1,000%, while the S&P 500 has grown just more than 60%.

AMZN Chart

About 60% of consumers' decision to buy, recommend, or invest in a company depends on perception of the company, says the Reputation Institute. The research firm also found that when a company improves its reputation by 5 points, it coincides with a 6.3% increase in consumer recommendation and a 5% increase in propensity to buy the stock.

For the past seven years, companies with a stronger reputation have performed significantly better (almost twice the return) than the overall market.

One notable company missing from this year's list is Apple (AAPL), which dropped from 57th in 2014 to 187th this year. It doesn't even rank in the top 20 for the technology industry. Samsung (SSNLF) leads the technology industry, though it only makes the 28th spot overall.

"There's no question Apple is at the top for innovation," Hecht said. "Their challenge is Apple has a much more inward culture that focuses more on what Apple does than what they can do to benefit society and their customers. They haven't been as effective in explaining how they're more open and transparent."

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