Have you adequately defined reputation Risk in your Business

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Have you adequately defined Reputation
Risk in your Business? By Deon Binneman
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Community

The classic definition is that
Reputation is all that is
generally believed about your
character, respectability,
credit, integrity or notoriety.
(Latin: reputatio reckoning)
Risk in your Business? by Deon Binneman

Definitions that give it
more meaning:
Reputation is a state of mind – A Set of memories,
perceptions and opinions that sits in your
stakeholders’ consciousness.
Reputation is the net result of the interactions of
all the experiences, impressions, beliefs, feelings and
knowledge all stakeholders have about a company.

So what then is Reputation Management?
It is essentially a consulting discipline that realizes
that Reputation is both an asset and a risk.
Reputation Management is the building, sustaining,
and protection of an organization’s good name,
generating positive feedback from stakeholders and
resulting in the attainment of strategic and financial
objectives.
It implies that there is a definite financial link
between the work we do in reputation management
and the bottom line.

Consider the following definitions as part of our
approach to building and protecting reputation
Definition 1: (Stakeholder Perspective)
Definition 2: (Asset Perspective)
Definition 3: (Incident Perspective)
Definition 4: (Compliance Perspective)

Definition 1: (Stakeholder Perspective)
 Reputational Risk emerges when the reasonable
expectations of stakeholders about an
organization‘s performance and behavior are not
met. This has been listed in some surveys as the
most dangerous reputation risk of all.
 It essentially involves taking a look at each
stakeholders needs and expectations, matching
the drivers of an organization reputation and
minimizing the gaps that exist.

Definition 2: (Asset Perspective)
 Some studies show that Reputation makes up
between 55 – 73% of a company’s asset value.
 Reputational Risk is defined as the loss of
earnings that occur in a situation of negative
public opinion. It normally results in loss of
sales, share value decreases and breakdown of
relationships.
 Many a crises have led to stock price decreases
and impact in other areas of the business.

Definition 3: (Incident Perspective)
Reputational Risk is the exposure incurred from
unexpected incidents, or from unanticipated
response to the institution's initiatives, actions or
day-to-day activities.
This definition implies that Reputation Risk is the
risk that an activity, action or stance performed or
taken by a company or its officials will impair its
image in the community and/or the long-term
trust placed in the organization by its
stakeholders, resulting in the loss of business
and/or legal action, and is closely linked with the
asset perspective.

Definition 4: (Compliance Perspective)
Reputational Risk can also be defined and viewed
as the loss or negative publicity that can arise
from failure to meet regulatory or legal
obligations.

Tip – It is essential that you define
Reputation Risk in these four ways in
your business, as each definition implies
a different mitigation strategy and
potential danger.

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Have you adequately defined reputation Risk in your Business

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Have you adequately defined reputation Risk in your Business