Badwill

Written By
Paul Tracy
Updated July 22, 2021

What is Badwill?

Badwill is essentially damage to a company's reputation. 

How Does Badwill Work?

For example, let's assume that Company XYZ becomes aware that one of its factories in the Pacific Northwest is not structurally strong enough to withstand a mild earthquake. Three years after it obtains this information, there is a 6.2-magnitude earthquake. Like other buildings in the area, the factory crumbles and several workers are killed. After the incident, the media discovers that Company XYZ knew the building could not sustain such a hazard but did not make any effort to make the building safer. The company becomes the target of tremendous negative media attention, and the incident creates a considerable amount of badwill.

Why Does Badwill Matter?

In financial markets, reputation has value. Good reputations attract and retain customers and investors; bad reputations do the opposite. Scandals and other events that damage reputations create badwill, which in turn reduces shareholder value.

Activate your free account to unlock our most valuable savings and money-making tips
  • 100% FREE
  • Exclusive money-making tips before we post them to the live site
  • Weekly insights and analysis from our financial experts
  • Free Report - 25 Ways to Save Hundreds on Your Monthly Expenses
  • Free Report - Eliminate Credit Card Debt with these 10 Simple Tricks
Ask an Expert
All of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Badwill.
Be the first to ask a question

If you have a question about Badwill, then please ask Paul.

Ask a question

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 3 million monthly readers.

If you have a question about Badwill, then please ask Paul.

Ask a question Read more from Paul
Paul Tracy - profile
Ask an Expert about Badwill

By submitting this form you agree with our Privacy Policy

Don't Know a Financial Term?
Search our library of 4,000+ terms