Google’s CEO set off a debate this week, predicting that kids would change their names at 18 to wipe their reputation slates clean.  Records of bad behavior – embarrassing status updates, pictures — would still be online, but employers and spouses wouldn’t be able to find them when searching for the adult name.   Consider it a form of bankruptcy where the benefit is a clean slate and the cost is the need to re-build reputational credit.

Which leads to the question, could companies declare reputational bankruptcy?

First let’s delve into Schmidt’s idea, assuming that laws are passed allowing personal reputational bankruptcy. (Sure, you can legally change your name now, but then you’d stick out for having no past of any kind online.  Everyone would need to do it to work and that requires new laws.)  How would it be enforced?  Would taboos emerge to reinforce them?  A “what happens in childhood stays in childhood” ethos?  How about Mutually Assured Destruction, where if you tell people I played with matches I’ll disclose you cheated on your spelling test?

I don’t see how the law could be enforced.  A single accidental linkage of #NameAt7 and #NameAt18 online would negate the name change.  Also, since not all sins are created equal, the leverage acquaintances hold over each other wouldn’t assure silence.  If the worst thing you did as a child was pull someone’s pigtails, and a kid you know shoplifted a toy, that’s a serious imbalance.  If you can think of another technique to enforce these rules, I’m happy to change my mind.  But for the time being, I don’t see any way it can work.

But what about companies?

Pre-web, it was possible for a troubled company to re-brand.  With the passage of time, people would forget and reporters would stop reminding them because it wasn’t newsworthy anymore.  But with the advent of search, the dynamic changes.  Why?  Because if a company hasn’t done something wrong, then it’s in its interest to keep building brand visibility.  If it has done something wrong, and the degree of harm is such that it needs to change its name, then it’s already too late.  The audience is already too large for a thousand comments to NOT make it online.

Search engines don’t follow the same rules as reporters, so #FirstCompanyName and #SecondCompanyName will always be linked, never forgotten.

So if the goal for both people and companies is to continue to be trusted by their communities, then what we’re left in moving on from our pasts is forgiveness.  It’s here that companies will have an easier time.

People and companies both do dumb things.  But bad boards, CEOs, staff and products can all be replaced.  People won’t forget that a company did something wrong, but they’ll forgive the company knowing that the people behind its walls are different.

Proving that a person has changed is a lot harder.  You can’t inspect a person’s mind the way you can a factory floor.  For people, trust will take longer to rebuild and in some cases, can never be fully salvaged.

Here are a couple of resources that touch on the topic: “The Future of Reputation” and  Wikipedia entry on “Whuffie.”

What do you think about the technical and societal limitations on declaring reputation bankruptcy?