The largest chain in the industry saw its reputation slip “significantly” after its longtime spokesman pled guilty to charges of child pornography and having sex with minors, reports consulting firm Reputation Institute.
Between the first and third quarters of 2015, Subway’s reputation score fell from 75.4—considered by Reputation Institute as “strong”—to 69.3, which the Institute pegs as “average.” Perception data was obtained by the firm through consumer surveys.
Companies seen as less reputable often underperform more-reputable companies on the stock market and have a harder time recovering from a crisis, Reputation Institute has found.
Subway parted ways with spokesman Jared Fogle earlier this year after he was arrested as part of a federal child-pornography investigation. The chain initially claimed that it had no knowledge of Fogle’s sexual interest in underage girls, but later acknowledged that it had received warnings but had not responded to them.