Posts Tagged ‘reputation risk’

A few interesting things crossed my mind and desk this week that I thought I would share. All reputation-related of course. 1. The World Economic Forum released its report on the top risks facing the world in 2012. Social unrest and income inequity were at the top. Natural disasters such as the earthquake in Japan were also high on the risk list. And as pointed out, one risk affects another creating a domino effect. "The Internet, meanwhile, can magnify and spread the effects of a disaster in other ways. Rumors, even if incorrect, spread quickly on social networking sites — sometimes more rapidly than emergency services can communicate accurate information. As word of disasters like the terror attacks of Sept. 11 or the earthquake in Japan spreads globally, consumers hunker down in front of their computer screens or televisions, rather than going about their daily lives. This increases the economic effects of a crisis, even in areas far removed from the source."  Disasters such as the horrific earthquake, tragic 9-11, death-defying financial crisis, massive oil spills and nasty ash clouds coming from Iceland all heighten other risks in some way. And risk spells reputation damage depending on how a company or country responds and solves the problem. 2. The report from WEF also mentioned that risks are on the horizon as leadership transitions are in full force this year. It is not just the U.S. presidential election that poses risk and stirs up emotional angst. There are leadership transitions underway this year in France, Russia and China as well. Add to that the sudden transitions in the Arab world this past year and we see upheaval and uncertainty. When CEO transitions are underway, the first few months can be risky so as we see world leaders change, tighten your seatbelts. The public will be more socially active than ever. We've already seen that in Russia. 3. I've written here about rankings and so-called "worst of" lists where companies, CEOs and environmental records are put on notice that they are not making the grade. In most Januarys, TripAdvisor.com comes out with its "dirtiest hotels" in the world.  No more. The CEO Stephen Kaufer says, "We want to stay more on the positive side, so we'll continue to feature the best destinations, the top hotels.  We're slicing and dicing the 'best of' in different ways this year, more than focusing on the negative."  Although the article where I learned about this says there were potential legal considerations and competitive reasons for abandoning the January list, it also mentioned that the original "worst of" list was done for PR reasons and that TripAdvisor is less interested in that now.  Perhaps there is a reputation-reason afoot here. There is so much negativity online on some of these sites and it is so easy to find what you are looking for that a list of the 10 worst may be hardly worth alienating visitors to your site. Everyone worries about the detractors and the praisers. Maybe it is time to just worry about the average site visitor who does not want snarky comments and lists, but just the plain old straight forward facts to plan a plain old relaxing get-away.

There has been a fair amount of news this year about people who risk everything and ultimately lose their whole reputation.  Why would anyone take that risk?  An article on "What makes a rogue trader?" made me think about people who take risks without realizing that they have so much to lose.  Also the news today about Illinois Governor Rod Blagojevich being sentenced to 14 years in jail for corruption made me wonder what drove him to this pitiful situation. Money? Power? Just because he could do it. Interestingly, the article posits one theory...."What matters most of all is not how much a gamble alters their wealth, but where they start --whether they are already satisfied, or have suffered loss. Their overriding trait is their inability to accept loss." Thus, these people are compelled to do whatever they have to in the name of gaining more wealth or achieving political office to avoid loss of their stature or status or sense that they are okay human beings. The loss seems to always outweigh what they sought in the first place. And these risk-takers lose all remnants of reputation and respect in the end. Something that you can't even put a price on. Makes you think about Bernie Madoff. What was he thinking? His reputation is in shreds, at best.

We recently released an interesting exploration on the relationship between top corporate communications officers and legal counsel when it comes to reputation management. I have already posted about this relationship where these two senior corporate officers seem to be working together more than ever. In light of the multiplying crises that companies and its leaders are facing on an hourly basis, the relationship between the two officers including outside counsel has to be strong and respectful.  As we say in the report, “general counsels (GCs) and chief communications officers (CCOs) are now finding themselves participating in the same reputation management strategy meetings, conference calls and contingency planning sessions. GCs, external legal advisors and CCOs now have no choice but to trust and understand each other.” There are several noteworthy insights and best practices in “Managing Legal and Reputation Risk” but two stand out for me in particular. The first is that you can’t prepare enough and expect surprises. ...”executives still find the nature or intensity of the situations they’ve managed to be unfamiliar or unanticipated on some level.” This is so true. There is always something overlooked or unexpected.  In fact, it seems to me that it is getting harder to find precedence for some of the crises that arise. For example, the Olympus crisis has few precedents.  For this very reason, being ready, practicing a few scenarios ahead of time and giving time to “near misses” are sensible readiness processes to have in place. Another finding that resonated with me was how general counsels appeared more willing today to balance the interests of the business with legal priorities. They said this, not just me. There are times when the short term hit (such as apologizing or admitting that the company could have done better and will do better in the future) outweighs the costs of winning or losing in a court of law down the road. The fact that many of the legal counsels we interviewed agreed that the “short-term pain for long-term gain” is often the right strategy demonstrated the transformation in communications-legal circles that we explored.

  Just returned from a multi-city tour of Europe where my colleagues and I talked about socializing your brand. This was based on our (Weber Shandwick) new recent research. We spoke to many clients and prospects about digital communications and the rewards and risks that come with this new territory.  Someone asked how you balance the reward-risk ratio when your senior management does not recognize that digital is so important to reputation today. In fact, our research found senior marketing/brand/comms executives saying that over half (52%) of a brand reputation today is attributed to how social it is. And this figure is expected to grow exponentially as time goes by. This gentleman said that being a social brand is akin to surfing with sharks. I loved the analogy because it explains how great it can feel to employ digital to communicate and give voice to a brand's story and yet how unexpected it can be when you feel that shark ripping into your reputation. The answer of course is being prepared. That's what the best of companies do. Crisis readiness gives you the head start you need today, in both a digital and non-digital world. Reputation is increasingly hard to manage while swimming with the unknown.

The second survey of Board Directors was just issued. The survey is conducted by Eisner Amper, audit, tax and business advisory professionals. They used their database and NACD's Directorship magazine's subscriber list of corporate directors. The survey reports on the opinions of 142 directors representing publicly and privately-held companies.  One of the questions they asked was which risks are most important to their boards, that is, besides financial risk (which probably begs a 100% answer!).  The chart is below. At the top of the list is reputational risk -- 69% said this is most important today. Reputational risk surpasses regulatory compliance risk (61%), CEO succession (55%) and IT risk (51%). I would posit that if this survey was done in the past few weeks, IT risk might have jumped up higher as a factor of major concern. The hacking and hobbling of computer networks at Boeing, Sony and the White House gmail accounts have had to certainly affect risk management concerns at board level.  With regard to security risks, Eisner Amper wisely says: "The tools of today's business heavily revolve around information technology, the Internet, the speed and degree of data transmission, and the pervasiveness of social media." And everything that affects business affects reputation.

Aside from financial risk, which are most important to your boards?	Board Directors
Reputational risk	69%
Regulatory compliance risk	61%
CEO succession planning	55%
IT risk	51%
Product risk	34%
Privacy and data security	33%
Risk due to fraud	21%
Outsourcing risk	14%
Tax strategies	14%

Another question they asked which I like was where board directors go to for new information. In the 2011 survey, the leading sources were company management, publications, Internet, accounting/advisory firms and conferences (at 33%).  I liked seeing the importance of conferences among the other sources because I firmly believe that getting out of the office and listening to other points of views provide opportunities for thinking beyond the same old ways about the same old problems.  I wish I did more of this myself.  We all need to close the door on our silos. For board members, this is a good sources considering how the problems they face have to be on high boil these days.

Primary Sources for New Information	Board Directors
Company management	73%
Publications	54%
Internet	46%
Accounting and advisory firms	36%
Conferences	33%
Personal network	33%
Associations	229%
Law firms	17%
Consulting firms	11%

At the end of their executive summary, Eiser Amper concludes:

"Protect. Protect. Protect. Reputational risk needs constant monitoring and analysis of the broader issues...Brand, company and personal reputation can change overnight. The speed of today's business was unimagineable in years past, but its impact is real and protection is the name of the game."

 

The incidents were the latest examples of what security experts call “reputational attacks” on media companies that publish material that the hackers disagree with. Such companies are particularly vulnerable to such attacks because many of them depend on online advertising and subscription revenue from Web sites that can be upended by the clicks of a hacker’s keyboard — and because unlike other targets, like government entities and defense contractors, they are less likely to have state-of-the-art security to thwart attacks.

As I was reading this article this morning on how several media companies were dealing with recent hackings, I noticed a call out box saying "So-called reputational attacks follow controversial reports."  The hackings over the past few days of news programs on public television came about because of negative stories that were clearly disliked  by certain parties. I would underscore that most entities -- government, military, corporate or otherwise -- are having a very difficult time with hackers, privacy, leaked information, etc.  I was somewhat surprised when I saw "reputational attacks" in quotes as if this was a new label of sorts. Reputational attacks online have become commonplace and not just assaults on media companies. Either way, the most interesting element in the discussion on these "so-called reputational attacks" is the common refrain that they are usually the work of repressive governments. And these attacks are much more than reputation vandalism or Web site defacing. In fact, this is reputation warfare. No doubt about it. The reputational risks that companies and organizations are increasingly facing continues to amaze me.

Korn/Ferry just released some new research Buy Isoprinosine Without Prescription, among executives and board members worldwide. Purchase Isoprinosine online no prescription, Risk management is clearly a topic du jour among the executive class. The survey found that nearly six in 10 (57%) are spending more time and attention on risk management, købe Isoprinosine online, αγοράζουν online Isoprinosine. Kjøpe Isoprinosine online, bestill Isoprinosine online, In light of the rolling crises that seem to be playing out in the media over the past eight months, it pays to be prepared and know what's on the horizon, rx free Isoprinosine. Chicago, Illinois. Houston, Texas, In our business at Weber Shandwick, crisis response and crisis preparedness seems to be on the upswing, Isoprinosine for sale, Isoprinosine over the counter, thereby highlighting top execs' concern over being in the "hot seat."

Two findings stood out. First, a full 59% said that the recent scrutiny on reputation risk has had a good effect on how Boards perceive the need for crisis preparedness and reputation management, Buy Isoprinosine Without Prescription. Steve Mader at K/F says that the survey "shows the majority of companies have already taken practical steps to enhance their risk management practices and awareness." I agree, where can i find Isoprinosine online. 5mg, 50mg, 75mg, 100mg, Secondly, as you have heard me say and post, acheter en ligne Isoprinosine, acheter Isoprinosine bon marché, Buy cheap Isoprinosine no rx, the CEO is the guardian of the company's reputation which includes such components as people, products/services, reasons to buy Isoprinosine online, Isoprinosine FDA approveds, responsibility, financial performance, Indianapolis, Indiana, San Francisco, California, Where can i buy cheapest Isoprinosine online, leadership and "values" or "ethics." K/F asked these executives who at the company has direct responsibility for risk management and the lead candidate was the CEO at 43%. Next to the CEO came the COO at 19%, 400mg, 450mg, 500mg, 625mg. Where can i buy cheapest Isoprinosine online, CEOs continue to get all the blame for ethical or reputational transgressions and all the credit when things go right. That's the deal, Indianapolis, Indiana, San Francisco, California. Isoprinosine samples. Online buy Isoprinosine without a prescription. Order Isoprinosine online overnight delivery no prescription. Isoprinosine withdrawal, snort, alcohol iteraction. Buy Isoprinosine from canada. Köpa Isoprinosine online, Osta Isoprinosine online, Jotta Isoprinosine verkossa. Japan, craiglist, ebay, overseas, paypal. Australia, uk, us, usa. Isoprinosine in cats, dogs, children, man, woman, men, women. Isoprinosine over the counter. Where can i buy Isoprinosine online. Order Isoprinosine online c.o.d. 0.4mg, 0.5mg, 1mg, 2.5mg. Isoprinosine from canadian pharmacy. Nashville-Davidson, Tennessee. Portland, Oregon. Buy Isoprinosine online no prescription. Boston, Massachusetts. Charlotte, Carolina. Buy Isoprinosine from mexico. Buy Isoprinosine without a prescription. Buy Isoprinosine online cod. Buy Isoprinosine without prescription. Where can i find Isoprinosine online. Buy cheap Isoprinosine. 400mg, 450mg, 500mg, 625mg. Farmacia Isoprinosine baratos, Isoprinosine online kaufen. Reasons to buy Isoprinosine online. Philadelphia, Pennsylvania. Phoenix, Arizona. Acheter en ligne Isoprinosine, acheter Isoprinosine bon marché. Baltimore, Maryland. Milwaukee, Wisconsin. 5mg, 50mg, 75mg, 100mg. Purchase Isoprinosine online. 125mg, 150mg, 200mg, 250mg. San Diego, California. Dallas, Texas. San Antonio, Texas. Order Isoprinosine no prescription. New York. Los Angeles, California. Chicago, Illinois. Houston, Texas. Isoprinosine trusted pharmacy. Isoprinosine FDA approveds. Rx free Isoprinosine. Austin, Texas, Memphis, Tennessee. Isoprinosine coupon. Buy Isoprinosine no prescription. El Paso, Texas. Washington, D.C. Seattle, Washington. Buy cheap Isoprinosine no rx. Oklahoma City, Oklahoma. Las Vegas, Nevada. Where can i order Isoprinosine without prescription. 1000mg, 2000mg.

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      The Conference Board Reputation Risk Research Working Group issued a new report on Reputation Risk. They concluded from the working group and a survey among 148 large company risk management executives that risk management needs to be better integrated into the enterprise risk management (ERM) function. Only about one-half (49%) highly integrate the two.  The report provides insights into how some companies are measuring reputation risk and new tools that deliver on this need. Reputation Institute and Evolve24 are both cited. One of the findings that parallels ours is that social media is gaining traction in the corner suite but many executives are overlooking its risks.  According to the Conference Board report, only 34% of respondents stated that they extensively monitor social networking sites and an even fewer 10% actively participate. As I have said, the good news is that executives are no longer asking their assistants to print out their emails to read but they still have far to go in terms of understanding the new media and making it work for their companies in identifying opportunity and yes, early warning signs.